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Gold treads water at start of busy week for data, Fed speakers

Published 06/26/2017, 03:00 AM
© Reuters.  Gold treads water at start of busy week
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Investing.com - Gold prices were little changed in European morning trade on Monday, as investors looked ahead to comments from key Fed officials and a raft of U.S. economic data in the week ahead for further signs of the central bank's likely rate hike trajectory through the end of the year.

Comex gold futures were at $1,255.73 a troy ounce by 3:00AM ET (0700GMT), down less than 0.1%. Meanwhile, spot gold was at $1,254.98.

Gold climbed for a third session in a row Friday, extending gains from a five-week low of $1,241.70 hit last week.

Also on the Comex, silver futures ticked up 3.2 cents, or roughly 0.2%, to $16.67 a troy ounce.

Market players are expected to pay close attention to comments from Federal Reserve Chair Janet Yellen on Tuesday, as they look for more hints on the timing of the next U.S. rate hike and clues on how the central bank plans to pare back its balance sheet.

Traders will also keep an eye out on a final reading of U.S. first-quarter economic growth due on Thursday for further evidence on the health of the world's biggest economy.

Besides the GDP report, this week's calendar also features U.S. data on durable goods orders, consumer confidence, pending home sales, weekly jobless claims as well as personal income and spending, which includes the personal consumption expenditures inflation data, the Fed's preferred metric for inflation.

The Fed raised interest rates for the second time this year earlier in June and maintained plans to go ahead with another rate hike by year-end. Despite the Fed's message, market players remained doubtful over the central bank's ability to raise rates as much as it would like in the coming months due to subdued inflation.

Futures traders are pricing in less than a 15% chance of a hike at the Fed's September meeting, according to Investing.com’s Fed Rate Monitor Tool. Odds of a December increase was seen at about 35%.

The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.

Investors are likely to continue to monitor the latest headlines coming out of Washington for progress on U.S. President Donald Trump's healthcare bill and for any new fallout from the investigation into the Trump campaign's possible ties to Russia.

Among other precious metals, platinum held steady at $931.00, while palladium dipped 0.5% to $852.15 an ounce.

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