Gold slips from record peak but holds above US$2,100 ahead of Powell testimony

GOLD prices edged lower on Wednesday (Mar 6) but held above the US$2,100 an ounce level, after rising bets for a June United States interest rate cut propelled bullion to a record peak in the previous session, ahead of Federal Reserve chair Jerome Powell’s testimony.

Spot gold edged down 0.2 per cent at US$2,124.46 per ounce, as at 0229 GMT. US gold futures fell 0.4 per cent to US$2,132.90.

Spot prices hit a record peak of US$2141.59 per ounce overnight on Tuesday, rallying for a fifth straight session.

US services industry growth slowed a bit in February amid a decline in employment and new orders for US-manufactured goods dropped more than expected in January.

Benchmark 10-year US Treasury yields hovered near one-month low levels, making non-yielding bullion more attractive.

Money market pricing shows traders see a 71 per cent probability that the Fed would begin cutting rates in June, up from 65 per cent on Tuesday morning, according to LSEG’s interest rate probability app.

Lower rates boost the appeal of non-yielding bullion.

Investor focus is on Powell’s first day of semi-annual testimony before Congress on the state of the US economy.

The world’s largest cryptocurrency, bitcoin, also surged to a record high overnight before retreating sharply.

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Gold hits record peak on US rate cut hopes

Data showed last week US manufacturing slumped further in February and inflation gradually easing, while consumer sentiment stood weak.

Spot platinum fell 0.1 per cent to US$879.46 per ounce, and palladium edged 0.2 per cent lower to US$946.51, while silver dropped 0.4 per cent to US$23.59. REUTERS