Dollar nears two-month high
US 10-year yields at two-week peak
Fed’s Bowman reiterates holding rates steady ‘for some time’
US PCE data due on Friday
Update prices
By Brijesh Patel and Daksh Grover
June 26 (Reuters) –Gold prices slipped 1% to their lowest level in more than two weeks on Wednesday, weighed by a stronger dollar and higher bond yields, while traders looked forward to US inflation data due later this week.
spot gold XAU= was down 0.8%, at $2,301.16 per ounce by 2:03 pm ET (1803 GMT), its lowest since June 10.
US gold futures GCcv1 settled 0.8% lower, at $2,313.2.
“At this point, the market may very well be responding to the firmer US dollar and we continue to price in the possibility that the US Federal Reserve is unlikely to move (interest rates) earlier in the summer,” said Bart Melek, head of commodity strategies at TD Securities.
The dollar =USD rose 0.4% to a near two-month peak against its rivals, making gold more expensive for other currency holders, while benchmark US 10-year yields US10YT=RR hit a near two-week high. USD/US/
The focus this week will be on the US Personal Consumption Expenditures Price Index, the Fed’s preferred inflation gauge, which could shed light on the central bank’s interest-rate path.
Also on the radar are US first-quarter gross domestic product estimates and a crucial debate between President Joe Biden and Republican rival Donald Trump on Thursday.
Data out on Tuesday showed US consumer confidence eased in June amid worries about the economic outlook, but households remained upbeat about the labor market and expected inflation to moderate over the next year.
Fed Governor Michelle Bowman said on Tuesday that holding the policy rate steady “for some time” would probably be enough to bring inflation under control, but reiterated a willingness to raise borrowing costs if needed.
Higher interest rates increase the opportunity cost of holding non-yielding bullion.
Elsewhere, spot silver XAG= lost 0.1% to $28.88 per ounce, palladium XPD= slipped 2%, to $929.25, while platinum XPT= climbed 3.1%, to $1,011.88.
Reporting by Brijesh Patel and Daksh Grover in Bengaluru; Editing by Maju Samuel and Pooja Desai
