 "Gold eases as investors await US inflation data due later this week")
By Brijesh Patel
(Reuters) - Gold prices edged lower on Tuesday as investors awaited U.S. inflation data due later in the week that could offer more clarity on the Federal Reserve's rate-hike plans to combat rising pricing pressures.
Spot gold was down 0.2% at $1,784.49 per ounce, as of 0256 GMT. U.S. gold futures eased 0.2% to $1,801.20.
On Monday, gold prices rose towards a one-month high scaled last week, as the dollar and Treasury yields pulled back after a rally driven by Friday's blockbuster U.S. jobs report. [US/] [USD/]
Investors are looking ahead to the U.S. consumer price report for July, which will be released on Wednesday. Analysts polled by Reuters expect annual inflation to have eased to 8.7% from 9.1% in June.
"Investors understand that both the U.S. and global economies are facing significant challenges, but the emphasis will be on the question for how long higher rates will be a weight on the market," said Clifford Bennett, chief economist at ACY Securities.
Also Read
"Any surprise softening in the U.S. inflation number could well be the catalyst for a tremendous surge in the gold price."
Fed funds futures traders are now pricing for a 64.5% chance of another 75-basis-point rate hike at the U.S. central bank's next policy meeting in September to combat soaring inflation.
Although gold is seen as a hedge against inflation, higher U.S. interest rates dull non-yielding bullion's appeal.
U.S. consumers' expectations for where inflation will be in a year and three years dropped sharply in July, a New York Federal Reserve survey showed on Monday, indicating U.S. central bankers are winning the fight.
China announced new military drills around Taiwan on Monday, eliciting concern from U.S. President Joe Biden, a day after the scheduled end of Beijing's largest exercises to protest last week's visit to the island by U.S. House Speaker Nancy Pelosi.
Spot silver fell 0.3% to $20.58 per ounce, platinum was steady at $939.49, and palladium slipped 1.4% to $2,199.57.
(Reporting by Brijesh Patel in Bengaluru; Editing by Subhranshu Sahu)
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)