Gold remains stable in early trade

11 Jul 2023 , 11:40 AM

As investors maintained a cautious attitude ahead of American inflation statistics that could affect the Federal Reserve’s rate policy trajectory, gold prices were stable in the early Asian hours of Tuesday.

Spot gold was unchanged at $1,925.89 per ounce. At $1,931.30, U.S. gold futures were unchanged.

Several U.S. central bank officials stated on Monday that the Fed’s current cycle of tightening its monetary policy is nearing an end and that it will likely need to boost interest rates further to reduce the still-too-high inflation.

According to CME’s Fedwatch tool, there is a 94% possibility that the central bank would increase interest rates at its meeting in July, holding them there until rate reduction may not occur until well into 2024.

The appeal of bullion, which doesn’t pay interest, is diminished by higher rates.

This week’s attention will be on U.S. CPI (Consumer Price Index) data, which is coming on Wednesday. According to a Reuters poll, core CPI in June is predicted to have increased 0.3% from the previous month.

According to a Monday Invesco study of central banks and sovereign wealth funds, more nations are returning their gold holdings as insurance against the kind of sanctions the West has imposed on Russia.

Spot silver increased by 0.1% to $23.13 an ounce, platinum increased by 0.4% to $929.95, and palladium increased by 0.2% to $1,242.51 an ounce.

Palladium dropped about 4.3% on Monday and is down over 31% for the year as the increasing adoption of electric vehicles threatens to stifle demand for the metal’s use as an autocatalyst at a time when the economy is struggling more generally.

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