Gold slips as Fed minutes, inflation data loom

GOLD prices inched lower on Wednesday (Oct 12) as traders looked forward to US Federal Reserve minutes and key inflation data for clues on the pace of future interest rate hikes.

Spot gold fell 0.1 per cent to US$1,663.60 per ounce, as of 12.55 am GMT, hovering close to a one-week low touched on Tuesday.

US gold futures were down 0.8 per cent at US$1,673.30.

The dollar index and benchmark US 10-year Treasury yields were steady in early Asian hours.

The Federal Open Market Committee will issue minutes of its Sep 20-21 meeting at 6.00 pm GMT later in the day. The US inflation reading will be released on Thursday and could cement expectations of another big rate hike at the November meeting.

Federal Reserve Bank of Cleveland President Loretta Mester said on Tuesday that even with a large amount of rate rises this year, the central bank has yet to get surging inflation under control and will need to press forward with tightening monetary policy.

While gold is considered as a hedge against inflation and economic uncertainties, rising interest rates reduce the appeal of the asset, which pays no interest.

The International Monetary Fund warned on Tuesday that colliding pressures from inflation, war-driven energy and food crises and sharply higher interest rates were pushing the world to the brink of recession.

Peru plans to formalise small-scale gold miners, mining minister Alessandra Herrera said on Tuesday, amid growing international pressure to shed light on the supply chain of the precious metal in South America's top producer.

Spot silver fell 0.6 per cent to US$19.08 per ounce, platinum rose 0.3 per cent to US$888.37 and palladium dipped 0.5 per cent to US$2,129.99. REUTERS



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