Gold prices steady with focus on US debt-ceiling talks
GOLD prices held steady in early Asian trade on Wednesday (May 17) after retreating from the key US$2,000-an-ounce mark in the previous session, while investors kept their eyes peeled for an outcome from the US debt-limit negotiations.
Spot gold held its ground at US$1,992.19 per ounce by 0032 GMT. US gold futures edged 0.1 per cent higher to US$1,995.40.
US President Joe Biden and top congressional Republican Kevin McCarthy edged closer to a deal to avoid a looming US debt default, as the threat of an economic nightmare prompted Biden to cut short an Asia trip this week.
US retail sales increased less than expected in April, but the underlying trend was solid, suggesting that consumer spending likely remained strong early in the second quarter, despite growing risks of a recession this year.
On the central bank front, Atlanta Fed president Raphael Bostic said on Tuesday the US Federal Reserve will need to stay “super strong” in fighting inflation even if the unemployment rate starts to rise later in the year,
Traders are currently pricing in an 85 per cent chance of the US central bank holding rates in June, according to the CME FedWatch tool.
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The dollar index, a measure of the greenback’s value against six major currencies, held firm.
A stronger dollar weighs on overseas demand for greenback-priced gold, while higher rates blunt non-yielding bullion’s appeal.
Meanwhile, Japan’s economy grew an annualised 1.6 per cent in January-March from the previous quarter, as firm private consumption and an unexpected rise in capital expenditure offset shrinking external demand, government data showed on Wednesday.
SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.09 per cent to 934.93 tonnes on Tuesday from 934.07 tonnes on Monday.
Spot silver was flat at US$23.74 per ounce, while platinum rose 0.4 per cent to US$1,061.43. Palladium fell 0.1 per cent to US$1,499.84. REUTERS
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