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Title: Gold Down Over Latest U.S. Inflation Data


Apr 13, 2022 12:54AM ET


By: AnalysisWatch


Gold prices eased in Asia Wednesday morning after rising as much as 1% in the previous session as investors digested the latest U.S. inflation data.


Gold futures were 0.26% lower at $1,970.90 an ounce at 12:46 p.m. ET (4:46 a.m. GMT), after hitting a near one-month high of $1,978.21 an ounce on Tuesday. The dollar, which normally moves inversely to gold prices, eased slightly on Wednesday but remained near May 2020 highs.


U.S. government bond yields fell slightly on Tuesday, with the 10-year Treasury yield falling for the first time in eight sessions.


Although data released Tuesday showed the highest inflation in the U.S. since late 1981, there was a small glimmer of hope that price pressures may have peaked.


According to the data, the March 2022 consumer price index (CPI) rose 8.5% year-over-year and 1.2% month-over-month. Core CPI rose 6.5% year-on-year and 0.3% month-on-month.


The war in Ukraine drove gasoline prices to a record high and provided the Federal Reserve with a strong case for a 50 basis-point rate hike in May 2022.


The war, sparked by Russia's Feb. 24 invasion of Ukraine, shows no signs of ending, and Russian President Vladimir Putin has also vowed to continue. The United States is also expected to send more weapons to Ukraine.


In the Asia-Pacific region, the Reserve Bank of New Zealand raised its key interest rate to 1.5% during the day, and the Bank of Canada followed suit later in the day. The European Central Bank and the Bank of Korea will announce their respective decisions on Thursday.


SPDR Gold Trust holdings rose 0.2% to 1,093.10 tons on Tuesday.


In other precious metals, silver was unchanged at $25.36 per ounce, while platinum was up 0.3% and palladium was up 1.1%.

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