Gold gains as dollar, yields retreat after Fed minutes

Gold prices rose on Thursday, as the dollar and Treasury yields pulled back slightly after U.S. Federal Reserve minutes hinted policymakers may be less aggressive on future rate hikes.

FUNDAMENTALS

* Spot gold was up 0.3% at $1,765.89 per ounce, as of 0055 GMT, after falling to a two-week low of $1,753.97 in the previous session.

* U.S. gold futures gained 0.2% to $1,780 per ounce.

* The dollar slipped 0.1% against its rivals, making gold less expensive for buyers holding other currencies.

* Benchmark U.S. 10-year Treasury yields edged lower to 2.8822% after hitting a near one-month high of 2.9190% in the previous session. Lower yields reduce the opportunity cost of holding non-interest bearing gold. [US/]

* In their July meeting minutes released on Wednesday, Fed officials said the pace of future rate hikes would depend on incoming economic data, as well as assessments of how the economy was adapting to the higher rates already approved.

* After the release of the minutes, traders of futures tied to the Fed’s policy rate saw a half-percentage-point rate hike as more likely in September.

* Data released on Wednesday showed U.S. retail sales were unexpectedly unchanged in July as falling gasoline prices weighed on receipts at service stations, but consumer spending appeared to pick up at the start of the third quarter.

* Britain’s consumer price inflation rose to 10.1% in July, its highest since February 1982, official figures showed.

* SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.32% to 989.01 tonnes on Wednesday from 992.20 tonnes on Tuesday. [GOl/ETF]

* Spot silver eased 0.2% to $19.80 per ounce, platinum was steady at $924.04, and palladium edged 0.2% lower to $2,137.20.