Investing.com - Gold prices edged higher in European trade on Wednesday, extending gains into a third-straight session, as investors awaited comments from Federal Reserve Chair Janet Yellen for fresh cues on policy direction.
Comex gold futures were at $1,217.27 a troy ounce by 4:00AM ET (0800GMT), up $2.60, or around 0.2%. Prices settled with a modest gain for a second-straight session on Tuesday.
Yellen is scheduled to testify on the economy before the Senate Banking Committee at 10:00AM ET (1400GMT) Wednesday. Text of the testimony will be released 90 minutes before she starts speaking.
Her comments will be monitored closely for any new insight on the timing of the next U.S. rate hike and clues on how the central bank plans to pare back its massive balance sheet.
The Fed hiked rates at its June meeting and stuck to its forecast for one more rate hike this year, but the subdued inflation outlook has since raised doubts over whether the U.S. central bank will be able to stick to its planned tightening path.
Fed Governor Lael Brainard on Tuesday suggested her support for any future rate increases will depend in part on how inflation shapes up.
Futures traders are pricing in around a 50% chance of a hike by the end of the year, according to Investing.com’s Fed Rate Monitor Tool.
The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion.
Besides the Fed, investors will be keeping a close eye on Washington, for any more political noise coming out of the White House as the Russia-linked scandal continues to rumble on.
Donald Trump Jr. released an email chain on Tuesday, which referred to a top Russian government prosecutor as offering the Trump campaign damaging information about Democratic rival Hillary Clinton.
The emails are the most concrete evidence yet that Trump campaign officials welcomed Russian help to win the election, a subject that has cast a cloud over Trump's presidency and spurred investigations by the Justice Department and Congress.
Also on the Comex, silver futures tacked on 4.3 cents, or roughly 0.3%, to $15.78 a troy ounce.
Among other precious metals, platinum was up 0.9% at $906.75, while palladium rose 0.6% to $851.80 an ounce.