Gold Subdued As Dollar Rebounds

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Gold prices were flat to slightly lower on Thursday as the dollar attempted a rebound from a two-week low hit in the previous session after a benign reading on U.S. inflation and a dovish Federal Reserve outlook.

Spot gold slid 0.1 percent to $1,840.72 per ounce, after having hit a more than one-week high on Wednesday. U.S. gold futures were little changed at $1,841.55.

The U.S. dollar is benefiting from a bounce in U.S. yields and low liquidity due to Chinese New Year holiday.

After a surprisingly soft reading on core U.S. inflation and dovish comments by Federal Reserve chairman Jerome Powell, investors now await the Labor Department’s report on weekly jobless claims for further direction.

In a speech on Wednesday, Fed Chair Jerome Powell emphasized that he wanted to see inflation at 2 percent or more before even thinking of tapering the bank’s super-easy policies.

Investors also keep a close watch on the developments on the passage of a $1.9 trillion U.S. relief bill.

The material has been provided by InstaForex Company – www.instaforex.com

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