Gold prices steady as markets assess Powell’s rate remarks

GOLD prices held steady on Thursday (Jun 22) after hitting a three-month low in the previous session following remarks from US Federal Reserve chair Jerome Powell that further interest rate hikes were on the table.

Spot gold held its ground at US$1,932.93 per ounce by 0028 GMT. US gold futures dipped 0.1 per cent to US$1,943.30.

Benchmark US 10-year Treasury yields were down to 3.723 per cent, while the dollar index held close to Wednesday’s lows.

Further rate increases are “a pretty good guess” of where the US central bank is heading if the economy continues in its current direction, Powell said in remarks on Wednesday to lawmakers on Capitol Hill.

Chicago Federal Reserve Bank president Austan Goolsbee said on Wednesday the central bank needs more clarity on inflation and the labour market’s trajectory before deciding on its next step.

Atlanta Fed president Raphael Bostic, meanwhile, became the first policymaker to suggest the Fed would need to wait at least past its July meeting to decide on further rate increases.

Interest rate hikes raise the opportunity cost of holding non-yielding bullion.

Elsewhere, the Bank of England is seen raising interest rates by a hefty half-a-percentage point on Thursday as inflation failed to ease in May.

Swiss gold exports rose in May after falling to their lowest in 10 months in April due to higher shipments to India, Swiss customs data showed.

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Gold range-bound as markets position for Powell’s testimony

Indicative of sentiment, SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.19 per cent to 932.30 tonnes on Wednesday from 934.03 tonnes on Tuesday.

Spot silver ticked up 0.1 per cent to US$22.671 per ounce, platinum rose 0.4 per cent to US$945.11, and palladium added 0.3 per cent to US$1,351.16. REUTERS