Gold steady in early Wednesday trade

Gold recovered its early losses on Wednesday, as the U.S. dollar declined from a six-week high and investors awaited economic reports due this week, Reuters reported.

Spot gold remained stable at $2,029.39 an ounce at 08:15 GMT, Futures for U.S. gold increased by 0.2 per cent to $2,030.50.

The dollar index dropped 0.3 per cent after reaching its highest level since Tuesday, December 13. Foreign buyers find bullion priced in U.S. dollars more alluring when the dollar declines.

U.S. benchmark 10-year Treasury note yields decreased to 4.1050 per cent.

“Recent economic data out of the U.S. has called for some recalibration in dovish market rate expectations, with some pushback on the timeline for Fed rate cut weighing on gold’s appeal,” Yeap Jun Rong, IG market strategist told Reuters.

“Rising geopolitical tensions may limit its downside… with the $2,000 level on watch as near-term support to hold,” he added.

Several economic data points will be in focus to influence Fed rate expectations.

The U.S. flash PMI report, which is due at 1445 GMT, the advance GDP estimates for the fourth quarter on Thursday, and the data on personal consumption expenditures on Friday are the main points of interest for the market.

Five quarter-point Fed rate cuts are projected by traders in 2024, down from six cuts two weeks earlier.

According to LSEG’s interest-rate probability app, the first cut, which was first observed in March, is now anticipated in May with a 90 per cent probability.

The opportunity cost of holding non-yielding bullion is decreased by lower interest rates.

Last week, a Fed official stated that the third quarter would be the baseline for cuts to begin.

Spot Silver soared by 0.9 per cent to $22.62 an ounce

Platinum rose by 0.5 per cent to $904.58.

Palladium went up by almost 1 per cent to $954.77