Gold gained on Wednesday, as a slight pullback in US dollar and Treasury yields helped bullion stabilize near a key $1,900 level as investors wait for guidance from major central bankers on the interest rate trajectory.
Spot gold firmed 0.1 percent at $1,900.09 per ounce, drifting further away from the five-month lows hit last week. US gold futures rose 0.1 percent to $1,928.60.
The dollar index was below the two-month highs, while a rally that took US Treasury yields to nearly 16-year highs took a pause, giving some respite to the non-yielding gold.
The annual Jackson Hole Symposium in Wyoming later this week will be monitored for any hints on how high can interest rates go, with a particular focus on Federal Reserve Chair Jerome Powell’s speech on Friday.
“Powell’s comments are expected to provide hints on the Fed’s thinking about the 2 percent inflation target and whether that target needs to be reviewed against the current backdrop of still elevated core inflation,” said Harshal Barot, a senior consultant at Metals Focus.
“If he does hint about a higher target, that could mean interest rates may not need to move any higher from here.” – Reuters
