By Eileen Soreng
(Reuters) - Gold prices steadied on Wednesday after plummeting to a more than nine-month low, with investors awaiting U.S. inflation data for cues on the Federal Reserve's policy tightening path.
Spot gold rose 0.1% to $1,728.09 per ounce by 0955 GMT, after dropping to its lowest since late-September at $1,721.98 earlier in the session. U.S. gold futures were also up 0.1% at $1,726.70.
"It's a dollar story right now and rising interest rates. Those two macro factors are weighing on the price of gold," said Fawad Razaqzada, market analyst at City Index.
"It looks like $1,700 is the next target ... If we get a strong CPI report today from the U.S., that could be the trigger to push gold down to that level."
The U.S. Labor Department's June Consumer Price Index (CPI) is expected to have accelerated by 1.1% and 8.8% on a monthly and annual basis, respectively.
A higher-than-expected inflation could underpin market expectations for a 75-basis-point interest rate hike by the Fed later this month, as the central bank seeks to tame soaring inflation.
Although gold is seen as an inflation hedge, higher rates draw investors away from bullion, as they tend to lift bond yields and thus raise the opportunity cost of holding zero-yield gold.
The dollar held near 20-year highs, continuing to make greenback-priced gold less attractive for buyers holding other currencies. [USD/]
Gold will rally from time to time as investors and traders try to pick the bottom, but the market will likely continue to stay flat or trend lower with a strengthening U.S. dollar, said Michael Langford, director at corporate advisory AirGuide.
Spot silver firmed 0.4% to $18.97 per ounce, platinum fell 0.2% to $844.01 and palladium shed 1.8% to $1,989.28.
(Reporting by Eileen Soreng and Bharat Govind Gautam in Bengaluru; Editing by Vinay Dwivedi)
(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.)
You’ve hit your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →
Quarterly Starter
₹900
3 Months
₹300/Month
Smart Essential
₹2,700
1 Year
₹225/Month
Super Saver
₹3,900
2 Years
₹162/Month
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Access to Exclusive Premium Stories Online
Over 30 behind the paywall stories daily, handpicked by our editors for subscribers


Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share


Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor


Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements


Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app