PRECIOUS-Gold steadies off recent lows on dollar, yields pullback

BY Reuters | TREASURY | 11/22/22 11:11 AM EST


Fed's November meeting minutes due on Wednesday


Platinum seen in deficit in 2023 - WPIC

(Adds comment, updates prices)

By Seher Dareen

Nov 22 (Reuters) - Gold prices on Tuesday steadied above last session's low as a retreat in the dollar and benchmark U.S. Treasury yields was offset by a rise in equities, while investors awaited cues on the U.S. Federal Reserve's monetary policy path.

Spot gold were unchanged at $1,737.19 per ounce by 2:04 p.m. ET (1904 GMT), while U.S. gold futures settled broadly unchanged at $1,739.9.

"I think the metals work their way out of this and continue to move higher. But right now it is a direct correlation with interest rates," said Daniel Pavilonis, senior market strategist at RJO Futures.

Major cities in China tightened COVID-19 curbs as virus cases spiked in the world's biggest consumer of the metal.

Global equities rose as Wall Street's main indexes gained on easing worries of a dull holiday season for retailers.

U.S. Treasury yields eased and the dollar also slipped, while investors waited for clues from the Fed's minutes due tomorrow.

"Gold got a little boost from the weaker dollar but that appears to be fading quickly," said Edward Moya, senior analyst with OANDA, in a note.

"The Fed is likely to stick to the hawkish script for a while and unless we see a major improvement with China's COVID situation, gold should struggle to muster up a meaningful rally."

Cleveland Fed President Loretta Mester said on Monday the central bank can downshift to smaller interest rate hike increments from next month, while San Francisco Fed President Mary Daly stated the policy rate was "modestly restrictive" with "more work to do."

While gold is considered an inflation hedge, high interest rates discourage investing in non-yielding bullion.

In other metals, spot silver rose 0.9% to $21.04 per ounce, platinum gained 0.5% to $987.32 while palladium fell 0.3% to $1,859.06. (Reporting by Seher Dareen in Bengaluru; Editing by Krishna Chandra Eluri)

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