Gold stalls as investors focus on Powell’s speech

GOLD prices were subdued on Tuesday (Oct 17) as US Treasury yields extended gains, ahead of economic data and Federal Reserve chair Jerome Powell’s speech this week that could steer upcoming interest rate decisions.

Spot gold dropped 0.2 per cent to US$1,916.20 per ounce by 0121 GMT, and US gold futures fell 0.2 per cent to US$1,929.90.

The US dollar and Treasury yields gained 0.1 per cent, making non-yielding bullion expensive for other currency holders.

Fed officials may not raise interest rates when they meet in two weeks, but neither will they say their 19-month drive to hike borrowing costs is over, a difficult messaging challenge US central bank chief Jerome Powell will take on this week.

Higher interest rates usually dull gold’s appeal as it increases the opportunity cost of holding the asset, which bears no interest.

While investors await more US interest rate cues, they are also keeping an eye on the Middle East tensions that boosted safe-haven gold prices to over three-week highs on Friday.

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SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.80 per cent to 855.45 tonnes on Monday.

Industrial gold production in Mali, one of Africa’s top producers of the precious metal, is expected to reach or even exceed its 67.7 tonnes forecast for 2023, according to a mines ministry official.

Newcrest Mining, which is in the final stages of a takeover by Newmont, on Tuesday posted an 18.1 per cent sequential fall in quarterly gold production, hurt by maintenance shutdowns during the quarter.

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Gold skids from one-month peak as investors struggle with war worries

Spot silver eased 0.2 per cent to US$22.55 per ounce, platinum was steady at US$890.81 and palladium rose 0.1 per cent to US$1,144.96. REUTERS