Gold fell in range-bound trading on
Wednesday as prospects of elevated interest rates continued to
override its safe-haven appeal to some extent despite looming
Spot gold fell 0.2% to $1,817.00 per ounce by 0920
GMT, holding a tight range between $1,814.30 – $1,822.76. U.S.
gold futures were down 0.2% to $1,817.60.
“The increasingly hawkish rhetoric out of major central
banks is exerting more downward pressure on zero-yielding gold,
with the ebbs and flows in risk sentiment injecting further
volatility in spot gold prices,” said Han Tan, chief market
analyst at Exinity.
But bullion could still find some support from growing fears
of a global downturn, Tan added.
U.S. Federal Reserve Chairman Jerome Powell is due to speak
later in the day at an ECB forum, and traders will watch for
policy cues following the Fed’s aggressive rate hike earlier
“Overall, the outlook for interest rates means that when we
do get a breakout of this trading zone we’ve been stuck in now
for a couple of months, it’s more likely to be to the downside,”
said Michael McCarthy, chief strategy officer at Tiger Brokers,
Analysts said gold has also been taking cues from dampened
sentiment in wider commodities markets as well as soaring
inflation takes a toll on the demand outlook.
Gold may eventually benefit from the economic worries, but
“right now, the jury is still out,” said Saxo Bank analyst Ole
Investor appetite across markets is pretty weak and from an
investment perspective, it has been a bad year so far, and gold
remains a “very tricky market to trade right now,” Hansen added.
European shares fell as fears about a global recession
overshadowed recent optimism about China.
Spot silver was little changed at $20.84 per ounce,
platinum rose 1.9% to $927.39 and palladium
climbed 1.3% to $1,898.45.
(Reporting by Arundhati Sarkar and Bharat Govind Gautam in
Bengaluru, Editing by Louise Heavens)