2023-06-07 16:29:00
© Archyde.com. A gold ingot in a branch of the Russian Goznak company on May 22, 2023. Photo: Maxim Shmitov – Archyde.com.
(Archyde.com) – It fell slightly on Wednesday due to a slight rise in US bond yields, yet the yellow metal remains locked in a narrow range of trading as investors await the release of inflation data and the Federal Reserve’s decision on interest rates during its meeting next week.
Spot market prices fell 0.1 percent at 1960.49 an ounce by (1340 GMT).
US gold futures fell 0.3 percent, at $1,976.50.
And US bond yields rose for 10 years to 3.706 percent, which raises the opportunity cost of holding non-returnable gold.
“Yields have remained relatively high, leaving little pressure on the gold market,” said David Meagher, director of metals trading at High Ridge Futures.
He added, “Obviously, inflation remains the main focus of this market. At this point, we would expect the US central bank to pause (in raising interest rates). However, if the inflation numbers start to rise more and more, you might see a change in the outlook.” .
The US inflation report for May, scheduled for release on the 13th of this month, prior to the council meeting, will provide investors with clearer details regarding the situation of the world’s largest economy.
Traders expect a 77 percent chance that the council will keep interest rates between 5 and 5.25 percent, and a 45 percent chance for another hike in July.
Weak US services sector data released earlier this week also boosted expectations that the Fed will stick to its decision on interest rates at this month’s meeting.
Gold prices are affected by the rise in US interest rates, as they increase the opportunity cost of holding non-returnable gold.
Jim Wyckoff, senior analyst at Kitco, said in a note that data from China showed that exports contracted faster than expected in May, pointing to a slowing global economy that might hamper demand for the precious metal.
As for other precious metals, it rose 0.4 percent to $23.68 an ounce, while platinum rose 0.6 percent to $1,038.12, and rose 0.4 percent to $1,417.23.
(Prepared by Mahmoud Abdel Gawad and Mahitab Sabri for the Arabic Bulletin – Edited by Ali Khafaji)
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