Gold steady on caution ahead of U.S. CPI, Fed meet

Gold prices were little changed in early Asian trade on Tuesday, as investors maintained caution ahead of U.S. inflation data and the Federal Reserve‘s policy decision.

FUNDAMENTALS

* Spot gold was steady at $1,781.66 per ounce, as of 0023 GMT. U.S. gold futures were up 0.1% at $1,793.40.

* The market’s focus now shifts to the U.S. consumer price index (CPI) report for November that is due at 1330 GMT.

* The U.S. central bank is widely expected to hike interest rates by 50 basis points at its final meeting of 2022 scheduled on Dec. 13-14.

* Lower rates tend to be beneficial for bullion as it decreases the opportunity cost of holding the non-yielding asset.

* Seizures of smuggled gold in India reached a three-year high this year after the government raised the import duty on the precious metal and international flights resumed following COVID-19 curbs.

* Goldman Sachs expects gold, with its real demand drivers, to outperform the highly volatile bitcoin in the long term, the bank wrote in a Monday research note.

* Holdings of the largest gold-backed exchange-traded-fund (ETF), New York’s SPDR Gold Trust, rose 0.3% on Friday.

* Spot silver was flat at $23.30, platinum was unchanged at $1,001.46 and palladium ticked 0.1% lower to $1,886.38.