One kilo gold bars are pictured at the plant of gold and silver refiner and bar manufacturer Argor-Heraeus in Mendrisio, Switzerland, July 13, 2022.
Denis Balibouse | Reuters
Gold prices steadied near a three-month peak on Wednesday as signs of cooling U.S. inflation boosted bets for smaller rate hikes, while reports around Russian missiles killing two people in Poland led to some demand for safe-haven assets.
Spot gold held its ground at $1,776.50 per ounce, as of 0103 GMT, after hitting its highest since Aug. 15 in the previous session.
U.S. gold futures rose 0.2% at $1,780.40 per ounce.
The United States and Western allies said they were investigating but could not confirm a report on Tuesday that a blast in NATO member Poland resulted from stray Russian missiles, while Russia’s defense ministry denied it.
The U.S. producer price index increased 8.0% for the 12 months through October compared with economist expectations for 8.3% and September’s 8.4% increase, according to the Labor Department data.
The data, following last week’s smaller-than-expected increase in consumer prices for October, encouraged investors who have been closely monitoring inflation data for signs that the Federal Reserve could slow its interest rate hikes.
Rising interest rates tend to dull bullion’s appeal as the metal pays no interest.
Atlanta Fed President Raphael Bostic said on Tuesday he sees little evidence that aggressive monetary policy tightening is slowing inflation, anticipating that more hikes would be needed to get inflation down to the Fed’s 2% target.
But, safe-haven gains for the dollar limited greenback-priced gold’s advance as the U.S. unit rose 0.2% against its rivals.
Read More: Gold firms on Fed slowdown hopes, latest Russia jitters