Gold steadies near three-week high as traders await more US data

Gold was perched atop a three-week high on Wednesday as traders positioned for more U.S. economic readings that could further alter the odds of another interest rate hike by the Federal Reserve.

Spot gold rose 0.1% to $1,939.23 per ounce by 1152 GMT, its highest level since Aug. 7. U.S. gold futures also rose 0.1% to $1,967.40.

U.S. job openings dropped in July to approach pre-pandemic levels, raising hopes that the Fed could lower inflation without a sharp rise in the unemployment rate.

“The chances of another rate hike before the end of the year dropped… and this caused a drop in U.S. Treasury yields and also in the U.S. dollar,” said ActivTrades senior analyst Ricardo Evangelista.

“Bad news for the economy will be good news for gold.”

Benchmark 10-year yields came off their lowest in more than two weeks, while the dollar hovered near lows hit during its worst session since Aug. 4 on Tuesday. [US/] [USD/]
Dollar-priced bullion, which bears no interest, finds support when bond yields fall. Investors now await the Commerce Department’s second take on April-June GDP at 1230 GMT, the PCE price index on Thursday and the nonfarm payrolls (NFP) report on Friday.

“Of course, the risk here is that the JOLTS (Job Openings and Labor Turnover Survey) report was a lone wolf and if the U.S. GDP and NFP data comes in hot, hold on to your gold hats as we could easily see Tuesday’s gains reverse,” said Matt Simpson, senior analyst at City Index.

Spot silver fell 0.5% to $24.61 per ounce, but was hovering close to a one-month high.

Platinum rose 0.7% to $983.04, its highest level since July 19. Palladium shed 1.1% to $1,234.85.

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This article was originally published by Indiatimes.com. Read the original article here.