NEW YORK: Gold prices edged higher on Wednesday as bargain hunters stepped in after bullion dropped to a near one-week low in the previous session, while traders awaited US private payroll data due this week for interest rate clues.
Spot gold rose 0.3 per cent to US$3,941.92 per ounce by 0115 GMT. Bullion fell more than 1.5 per cent on Tuesday, hitting its lowest since Oct 30, as the dollar firmed.
US gold futures for December delivery lost 0.3 per cent to US$3,950.40 per ounce. The dollar held just under three-month highs touched in the previous session.
The US Federal Reserve cut interest rates last week and Chair Jerome Powell suggested it might be the last reduction in borrowing costs for the year.
Market participants now see a 69 per cent chance of a Fed rate cut in December, down from over 90 per cent prior to Powell’s remarks, as per CME’s FedWatch Tool.
On Monday, Fed officials continued pressing competing views on the economy, a debate set to intensify ahead of the Fed’s December policy meeting and in the absence of key data, including from the Bureau of Labor Statistics, due to the federal government shutdown.
Investors are awaiting the ADP US employment data and ISM PMIs this week for clues on the interest rate trajectory.
Non-yielding gold tends to do well in a low-interest-rate environment and during times of economic uncertainty.
Bullion hit a record high of US$4,381.21 on Oct 20, but has fallen close to 10 per cent since then. Meanwhile, China ended a long-standing tax exemption policy for some gold retailers on Saturday, potentially setting back a gold buying spree in the world’s biggest consumer market.
Elsewhere, spot silver was steady at US$47.10 per ounce, platinum lost 0.9 per cent to US$1,521.30 and palladium was down 0.5 per cent at US$1,384.51.
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