New York, US (BBN)- Gold held weaker in Asia on Thursday on soft consumer prices in China and with expectations hardening for a rate hike by the Fed this month, but geopolitical risks on the Korean peninsula and the Middle east keeping the safe-haven precious metal supported.
Gold for April delivery on the Comex division of the New York Mercantile Exchange dipped 0.20 per cent to $1,206.95 a troy ounce, reports
Elsewhere, silver futures slipped 0.35 per cent to $17.237 a troy ounce while copper futures were last quoted down 0.04 per cent at $2.590 a pound.
Consumer prices in China fell to the lowest in two years at an annual pace of 0.8 per cent, the National Bureau of Statistics said on Thursday, which compared to a gain of 1.7 per cent expected as food prices dropped, and eased pressure after a 2.5 per cent gain in January.
On a month-over-month basis, CPI fell 0.2 per cent in February from a month earlier.
Producer prices rose for the sixth straight month in February from a year earlier, up 7.8 per cent.
Overnight, gold prices slumped to a 1-month low on Wednesday, after a better-than-expected ADP jobs report lifted expectations of a March rate hike.
ADP and Moody’s analytics said Wednesday, employment in the private sector climbed by 298,000 for the month, which dwarfed economists’ expectations of 190,000 and underpinned expectations the Federal Reserve will hike rates at its meeting this month.
The bullish ADP reports came ahead of Friday’s non-farm payrolls for February, viewed as a critical barometer of the US economy and represents the final key economic data point ahead of the Federal Reserve’s policy meeting on March 14-15.
According to’s Fed rate monitor tool, nearly 90 per cent of traders expect a rate hike in March, compared to just 80 per cent of traders on Monday.
Gold is sensitive to moves in US interest rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced.
Gold has traded on the back foot since Fed Chair Janet Yellen signaled last Friday the US central bank will hike rates in March, should inflation and jobs data remain on track.