(Reuters) – Gold prices eased on Wednesday as the dollar ticked higher, while investors awaited clues on U.S. interest rate hikes from the minutes of the Federal Reserve’s latest policy meeting.
Spot gold fell 0.3% to $1,770.09 per ounce by 1200 GMT. U.S. gold futures eased 0.4% to $1,782.30.
Gold is struggling to find a clear direction, and so the Fed’s minutes could represent a significant market driver, with the central bank’s annual Jackson Hole Symposium getting closer, said Carlo Alberto De Casa, external analyst for Kinesis Money.
“Inflation has given some signal that we could have reached the peak, but before seeing any further rebound in gold, investors will probably need some dovish signal from the Fed,” he added.
Recent hawkish remarks from Fed policymakers have led to a pullback in gold prices from the key $1,800 level, despite signs of easing inflation.
The next scheduled monetary policy meeting is on Sept. 20-21.
Rising U.S. interest rates increase the opportunity cost of holding non-yielding bullion.
However, StoneX analyst Rhona O’Connell said “the Empire State Manufacturing figures, which were dreadful, argue for a more benign rate hike than last time”, and that supports gold as it thrives on uncertainty.
“The Fed has dropped its previous policy of guidance so the minutes, which are three weeks out of date, will only really give us a backdrop,” O’Connell said, adding the market will, however, be waiting to read between the lines.
The dollar gained against its rivals, with the focus also on U.S. retail sales data. [USD/]
Meanwhile, world shares struggled and oil prices fell as the UK’s highest inflation since 1982 and a rate hike in New Zealand reminded investors of the challenges facing the global economy.[MKTS/GLOB]
Elsewhere, spot silver fell 1.3% to $19.86 per ounce, platinum slipped 0.9% to $926.17, and palladium dropped 0.8% to $2,135.77.
Reporting by Arundhati Sarkar in Bengaluru; Editing by Mark Potter, David Evans and Devika Syamnath