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GOLD prices were steady on Wednesday (Jun 19) after softer-than-expected US retail sales data reinforced bets of imminent Federal Reserve rate cuts.
Spot gold held its ground at US$2,327.76 per ounce, as at 0115 GMT. US gold futures edged 0.2 per cent lower to US$2,342.00.
US retail sales rose 0.1 per cent last month, the Commerce Department’s Census Bureau said. Economists polled by Reuters had forecast retail sales gaining 0.3 per cent in May.
Fed Bank of New York president John Williams said interest rates will come down gradually over time, but he declined to say when the US central bank can begin easing monetary policy.
Traders are currently pricing in about a 67 per cent chance of a Fed rate cut in September, according to CME FedWatch Tool.
Lower interest rates reduce the opportunity cost of holding non-yielding bullion.
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Federal Reserve officials, heartened by recent data, are looking for further confirmation that inflation is cooling and for any warning signs from a still-strong labour market as they steer cautiously towards what most expect to be an interest rate cut or two by the end of this year.
Investors are also focused on weekly jobless claims due on Thursday and flash purchasing managers’ indexes on Friday, which could offer more clarity on consumption and economic strength.
More central banks plan to add to their gold reserves within a year and more of them expect others to do so as well, due to macroeconomic and political uncertainty despite high prices for the precious metal, the World Gold Council said in its annual survey.
Spot silver fell 0.4 per cent to US$29.40 per ounce, platinum was down 0.4 per cent at US$968.59 and palladium gained 0.1 per cent to US$887.67. REUTERS
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