Gold ticks higher with focus on Fed meeting minutes

Gold prices inched up on Wednesday, as investors awaited the minutes of the U.S. Federal Reserve’s latest policy meeting that could offer clues on further interest rate hikes.

FUNDAMENTALS

* Spot gold was up 0.1% at $1,836.43 per ounce, as of 0056 GMT. U.S. gold futures firmed 0.2% to $1,845.20.

* Investors are awaiting the release of the minutes of the Fed’s latest meeting due at 1900 GMT on Wednesday. The U.S. central bank had raised rates by 25 basis points (bps) at its Jan. 31-Feb. 1 meeting.

* Money markets expect the U.S. central bank to raise benchmark rates above 5% by May and remain above 5% through the year.

* Bullion is seen as a hedge against inflation, but rising interest rates dull the non-yielding asset’s appeal.

* The dollar index eased 0.1%, making greenback-priced bullion less expensive for buyers holding other currencies. * U.S. business activity unexpectedly rebounded in February, reaching its highest level in eight months, according to a survey on Tuesday, which also showed inflation subsiding.

* Benchmark 10-year note yields hit their highest since November last year.

* Other data on Tuesday showed U.S. existing home sales dropped to the lowest level in more than 12 years in January, but the pace of decline slowed.

* Spot silver edged 0.2% higher to $21.86 per ounce, platinum rose 0.1% to $943.67 and palladium firmed 0.3% to $1,530.36.