NEW YORK: Gold prices were steady for a second straight session on Thursday as traders booked profits after prices climbed to a more than three-month peak this week, with markets awaiting Federal Reserve Chair Kevin Warsh’s speech at Jackson Hole for clues to his roadmap on inflation and monetary policy.
Spot gold was up 0.06percent at USD4,594.82 per ounce by 1502 GMT, after settling 1.4percent lower on Wednesday in its biggest one-day decline in a week. US gold futures for December delivery fell 0.1percent to USD4,648.60.
“We’re just seeing some mild profit-taking pressure from the shorter-term futures traders ahead of Friday morning’s speech by Kevin Warsh at the Jackson Hole Symposium,” said Jim Wyckoff, a market analyst at American Gold Exchange “Selling interest is being limited by a weaker dollar index today as we speak, but mostly just treading water ahead of this Jackson Hole meeting,” Wyckoff added.
Gold prices climbed to their highest since mid-May earlier this week, with the recent rally driven by renewed dollar-debasement concerns following the US Treasury’s move last week to ramp up buybacks of older long-dated bonds.
Markets are awaiting remarks from Warsh at the annual Jackson Hole symposium in Wyoming on Friday, with investors hoping the Fed chair will use his debut speech to explain his roadmap for returning inflation to the Fed’s target and what he sees as the bond market’s role in that strategy.
Data on Wednesday showed the US Personal Consumption Expenditures Price Index increased 3.7percent in the 12 months through July, unchanged from June. Economists polled by Reuters had forecast a PCE reading, which the Fed uses to set its target, of 3.6percent.
While expectations of a September US rate hike have gone down to just 34percent, there’s still a 74percent chance of a hike by December, according to the CME FedWatch Tool.
Higher interest rates typically dampen gold’s appeal, since the metal generates no yield of its own. Spot silver gained 0.9percent to USD68.72, platinum rose 0.08percent to USD1,830.67 and palladium lost 0.3percent to USD1,323.94.
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