By Gina Lee
Investing.com – Gold was up on Wednesday morning in Asia, but Tuesday’s data that said U.S. consumer prices last month rose by the most in 13 years capped the yellow metal’s gains.
Gold futures were up 0.21% to $1,813.65 by 1:16 AM ET (5:16 AM GMT). The dollar, which normally moves inversely to gold, inched down on Wednesday, steadying after it saw its best daily percentage gain in nearly a month during the previous session.
The U.S. core consumer price index (CPI) rising a higher-than-expected 0.9% month-on-month in June, with consumer prices rising by the most in 13 years. As supply constraints and a rebound in the costs of travel-related services from COVID-19-depressed levels continue, it is expected that inflationary concerns are set to remain.
Investors’ focus is now shifting to U.S. Federal Reserve Chairman Jerome Powell’s testimony before Congress later in the day for any clues on when the central bank will begin asset tapering and hiking interest rates. Powell has thus far insisted that higher inflation would be a temporary phenomenon.
A senior White House official said on Tuesday that supply chain pressures that are fueling higher inflation are expected to abate in the “not-too-distant future,” but did not specify when.
Meanwhile, the Reserve Bank of New Zealand kept its interest rate unchanged at 0.25% while surprising markets by saying it would halt its large-scale asset-purchase program from the following week. The Bank of Korea and the Bank of Japan will also hand down their respective decisions on Thursday and Friday.
On the COVID-19 front, several countries tightened restrictive measures as cases involving the virus’ Delta variant increased. Australia extended the lockdown currently in place in Sydney by two another two weeks, while South Korea tightened social distancing curbs across most of the country on Wednesday, after hitting a fresh record of 1,615 daily cases on Jul. 14.
In other precious metals, silver was flat at $25.9 while palladium and platinum inched up 0.1%.