Gold Prices Subdued as Traders Await Fed Rate Outlook Cues
Gold prices edged lower as the dollar firmed on Monday, while investors awaited the U.S. inflation print to firm up bets on the size of a likely reduction in Federal Reserve interest rates.
Spot gold eased 0.2% to $2,493.34 per ounce, as of 0727 GMT. U.S. gold futures edged 0.1% lower to $2,521.80.
The dollar (.DXY), opens new tab rose 0.3%, making gold more expensive for other currency holders.
Major data points this week include the U.S. Consumer Price Index (CPI) for August on Wednesday, followed by Producer Price Index (PPI) on Thursday.
A low interest rate environment tends to boost non-yielding bullion's appeal.
Fed funds futures traders are now pricing a 75% chance of a 25-basis point cut at the Fed's Sept. 17-18 meeting, and a 25% chance of a 50 bp reduction, according to the CME FedWatch Tool.,
Data on Friday showed that U.S. employment increased less than expected in August, but a drop in the jobless rate to 4.2% suggested the labor market was not falling off the cliff to warrant a half-point rate cut.
Meanwhile, China's central bank held back on buying gold for its reserves for a fourth straight month in August, official data showed on Saturday.
Key metals consumer China's consumer prices accelerated in August, while producer price deflation worsened amid Beijing's efforts to spur domestic demand.
Spot silver rose 0.5% to $28.05 per ounce, platinum gained 0.8% to $929.17 and palladium was up 1.5% at $924.02.
Source : Reuters
