Welcome Guest! | World Time






New York

Gold dips as dollar ticks higher, all eyes on Fed

Wednesday,   10-Jul-2019   08:56 AM (IST)

Gold prices slipped on Wednesday as higher Treasury yields lifted the dollar, while markets awaited testimony from Federal Reserve Chair Jerome Powell for clarity on an expected U.S. rate cut. Spot gold was down 0.4% at $1,391.98 per ounce at 0103 GMT. U.S. gold futures slipped 0.4% to $1,394.40 an ounce. The dollar index edged toward a three-week high against a basket of major currencies on Wednesday, as easing bets of deep U.S. interest rate cuts pushed Treasury yields higher. Fed Chair Powell testifies before Congress on Wednesday and Thursday and the direction of the U.S. dollar depends on the tone of his comments. Expectations for a 50 basis point rate cut this month have evaporated, but investors still expect a 25 basis point cut due to weak inflation and trade war worries. Futures are still fully priced for a 25-basis-point cut at the Fed’s July 30-31 meeting, but have abandoned wagers on a half-point move. They had implied a 25% probability of an aggressive cut before Friday’s upbeat jobs report. Overnight, Atlanta Fed bank president Raphael Bostic let nothing out of the bag by saying the central bank was debating the risks and benefits of letting the U.S. economy run “a little hotter.” Asian shares inched ahead on Wednesday.