Gold slips from 3-week peak as dollar firms ahead of Fed minutes
07 Jul 2021
Gold prices edged lower on Wednesday after hitting a three-week peak in the previous session, as a rebound in the dollar weighed on the safe-haven metal ahead of the release of minutes from the U.S. Federal Reserve‘s June policy meeting.
* Spot gold was down 0.1% at $1,795.39 per ounce, as of 0103, after hitting its highest since June 17 at $1,814.78 on Tuesday.
* U.S. gold futures edged 0.1% higher to $1,795.80 per ounce.
* Making gold more expensive for holders of other currencies, the dollar index hovered near a three-month high hit last week.
* All eyes are on minutes from the Fed’s latest meeting, due at 1800 GMT, that is expected to shed more light on interest rate trajectory after a hawkish tilt from the U.S. central bank last month.
* Gold is highly sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion.
* U.S. services industry activity grew at a moderate pace in June, likely restrained by labor and raw material shortages, resulting in unfinished work continuing to pile up.
* Benchmark 10-year Treasury yields dropped to their lowest in more than four months after data suggested the U.S. economy might not be as hot as some fear.
* Investor sentiment in Germany fell by much more than expected in July, though remained at a very high level, while expectations for a strong economic recovery rose, a survey showed on Tuesday.
* The Dow and S&P 500 fell on Tuesday, with financials and other groups closely tied to economic growth leading declines, while the Nasdaq edged higher to another closing record.
* Silver eased 0.2% to $26.08 per ounce, palladium fell 0.5% to $2,780.68, and platinum slipped 0.6% to $1,085.62.