Gold flat as US yields negate firmer dollar

[BENGALURU] Gold prices were steady on Tuesday as a retreat in US Treasury yields countered a slight rebound in the dollar, while investors awaited key data on inflation due later this week.

Spot gold was steady at US$1,836.26 per ounce by 1.34am GMT, after hitting its highest since Feb 11 at US$1,842.91 on Friday.

US gold futures were down 0.1 per cent at US$1,836.40 per ounce.

The dollar index was up 0.1 per cent, making gold more expensive for other currency holders.

The US currency slipped to a more than two-month low in the previous session after US non-farm payrolls data on Friday showed jobs growth unexpectedly slowed in April.

Benchmark US 10-year Treasury yields were pinned below 1.6 per cent. Lower bond yields reduce the opportunity cost of holding non-yielding gold.

Bank of Japan policymakers warned of uncertainties over the country's economic recovery as pandemic curbs hurt service consumption, a summary of their opinions voiced at an April policy meeting showed on Tuesday.

Market participants awaited the release of US consumer price data due on Wednesday to gauge inflationary pressure and the Federal reserve's policy stance.

Fed officials would like to see higher inflation, more wage growth and several months of strong employment gains averaging one million jobs added before they would consider adjusting monetary policy, Chicago Fed Bank President Charles Evans said on Monday.

US President Joe Biden on Monday urged US companies to help workers gain access to vaccines and to raise their pay while touting an infusion of US$350 billion in federal aid to state and local governments.

Palladium fell 0.2 per cent to US$2,953.59 per ounce.

Silver was little changed at US$27.31 per ounce, while platinum was down 0.4 per cent at US$1,242.17.

REUTERS