Gold Ticks Up Ahead of US Inflation Data

SEATTLE (Scrap Monster): Gold prices edged up on Tuesday, ahead of a U.S. inflation report that could give fresh perspective on the timing of the Federal Reserve's first rate cut.

Spot gold XAU= was up 0.2% to $2,023.89 per ounce (Oz), as of 0733 GMT, after briefly slipping to a more than two-week low of $2,011.72/Oz on Monday.

U.S. gold futures GCcv1 also ticked up 0.2% to $2,037.50/Oz.

All eyes are on the January U.S. consumer price index (CPI) inflation data due at 13:30 GMT. Americans reported a fairly stable outlook for inflation at the start of the year, a New York Fed survey showed.

"A soft CPI print could cause the U.S. dollar .DXY and bond yields US10YT=RR to lose momentum, which could see gold make a run higher," said Tim Waterer, chief market analyst at KCM Trade. USD/ US/

Economists polled by Reuters see year-on-year CPI at 2.9% in January, down from 3.4% in December, and think core CPI also slowed to 3.7%, from 3.9% in the previous month. USCPI=ECI, USCPNY=ECI

"Trading in gold has been fairly steady today but with a mild downside bias, perhaps because key U.S. economic indicators have tended to beat on the upside in recent months," said Waterer.

Spot gold may retest support of $2,012/Oz, a break below which could open the way towards $2,002/Oz, according to Reuters technical analyst Wang Tao. TECH/C

Traders are pricing in four quarter-point rate cuts by the U.S. central bank this year, with a 62% chance of the first one arriving in May, according to LSEG's Interest Rate Probability app.

Trading volume is expected to be thin with markets in China and Hong Kong closed for the Lunar New Year holidays.

Spot platinum XPT= rose 0.3% to $891.54/Oz, palladium XPD= climbed 1.1% to $901.58, and silver XAG= rose 0.6% higher to $22.81.

 Courtesy: www.reuters.com