NEW YORK: Gold steadied near a one-month peak on Wednesday, although prices were stuck in a tight range with gains curbed by an uptick in the dollar and investor caution ahead of the release of US inflation data.
Spot gold was unchanged at $1,712.09 per ounce by 12:08 p.m. ET (1708 GMT). US gold futures were also steady at $1,715.80.
Bullion prices rallied more than 2% to breach the key $1,700 level on Tuesday.
Gold is holding near the top end of the range despite gains in the dollar index, said Phillip Streible, chief market strategist at Blue Line Futures in Chicago. “I’d be a little bit defensive on gold coming into tomorrow’s CPI data.” The US consumer price index (CPI) report for October will provide the latest read on inflation in the United States in the wake of the Federal Reserve’s aggressive interest rate hikes.
Economists are expecting a deceleration in both the monthly and yearly core inflation to 0.5% and 6.5%, respectively.
Gold is highly sensitive to rising US interest rates as they increase the opportunity cost of holding non-yielding bullion. Higher rates also boost the dollar, pressuring the greenback-priced precious metal.
The dollar index rose 0.5% after dropping to near a two-week low on Tuesday.