Gold inches higher, focus on Fed minutes
GLD•Fed minutes, oil prices and other metals
U.S. President Donald Trump said no talks were taking place with Iran and insisted the Strait of Hormuz was open, contradicting Iran's assertion that the critical waterway remained shut to shipping. The receding prospects of a deal to end the nearly six-month conflict drove up oil prices. O/R
Rising energy prices could bolster the case for higher interest rates to rein in inflation, despite recent U.S. economic indicators showing unexpected employment losses, milder inflation, and weak July retail spending.
Despite gold being known as an inflation hedge, higher rates usually weigh on gold prices as they strengthen the dollar and make yield-bearing assets more attractive to investors.
The Fed's release of minutes from the most recent meeting of its monetary policy-setting Federal Open Market Committee is due at 1800 GMT.
Traders are currently pricing in a 65% probability that the U.S. central bank will keep rates unchanged and a 35% chance of a rate hike in September, according to the CME FedWatch Tool.
Meanwhile, the Bank of England will leave interest rates unchanged at 3.75% for the rest of the year, according to a strong majority of economists polled by Reuters.
Among other metals, spot silver XAG= fell 0.5% to $62.99 per ounce. Platinum XPT= climbed 0.3% to $1,717.03, while palladium XPD= lost 0.3% at $1,286.73.
| Data/events (GMT) | |
|---|---|
| 0600 | UK Core CPI YY Jul |
| 0600 | UK CPI YY Jul |
| 0600 | UK CPI Services MM, YY Jul |
| 0600 | EU HICP Final MM, YY Jul |
Gold edges higher as Treasury yields ease
Gold prices edged higher in early Asian trade on Wednesday as U.S. Treasury yields eased from recent highs, while market participants awaited the release of the Federal Reserve's meeting minutes.
