Gold holds above $2,100 near record high, focus on Jerome Powell testimony
Gold prices held above the $2,100 level on Wednesday, near a record peak hit in the previous session as hopes for U.S. rates easing by mid-year mount, while traders awaited remarks on the economy's health from Federal Reserve Chair Jerome Powell.
Spot gold edged down 0.1% at $2,126.13 per ounce, as of 0458 GMT. U.S. gold futures fell 0.4% to $2,134.30.
Spot prices hit a record peak of $2141.59 per ounce overnight on Tuesday, rallying for a fifth straight session.
Gold's rally is sentiment driven, which was triggered by last week's poor U.S. economic data that gave little more clarity for a June rate cut, said Ajay Kedia, director at Kedia Commodities, Mumbai, adding, without other factors at play, such as dollar's movement, or any surge in geopolitical tensions, gold could see profit taking.
Traders are weighing in risks to the U.S. economic health in a high-interest rate environment and would be tuning into Powell's first day of semi-annual congressional testimony for more clarity on the same.
U.S. services industry growth slowed a bit in February amid a decline in employment and new orders for U.S.-manufactured goods dropped more than expected in January.
Data on the U.S. labour market due this week will also be closely watched for. Any downside surprise could help support gold.
Traders see a 71% chance for a June Fed rate cut. Lower rates boost the appeal of non-yielding bullion.
"The central banks are buying more than 1,000 tons of gold consecutively from last two years versus the historic average of 300 (tons). This has made-up for all the loss in the retail and ETF demand," said Kunal Shah, head of research, Nirmal Bang Commodities, Mumbai. [GOL/ETF]
Spot platinum rose 0.4% to $884.16 per ounce, and palladium rose over 1% to $958.20, while silver dropped 0.3% to $23.63.
