Investing.com - Gold prices rose on Wednesday, but investors remain cautious ahead of today’s U.S. inflation data and clues on the pace of future interest rate hikes.
Gold futures for February delivery were up 0.53% to $1,337.40 a troy ounce by 10:20pm ET, supported by a weaker dollar. A retreat in the dollar has helped gold prices to rebound from its one-month low of $1,306.81 an ounce last week.
The U.S. Dollar Index that tracks the dollar against a basket of currencies was down 0.11% to 89.60, but gold prices are likely to be range bound before the release of U.S. inflation data.
Gold is sensitive to moves in both U.S. rates and the dollar. A weaker dollar makes gold less expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
Asian equities were mixed in Wednesday, with Hang Seng and KOSPI gaining in the morning trading session but Nikkei, ASX, Shanghai Composite and Shenzhen Component traded in the red. Japan took centre stage in the region as the country’s 4Q GDP missed estimate and grew 0.5% vs the expected 1%.