Gold struggles for traction as traders await Fed cues

Gold prices struggled for momentum in early Asian trading on Tuesday, as traders awaited a U.S. Federal Reserve meeting due next week for clues about its monetary tightening path.

* Spot gold was little changed at $1,955.24 per ounce by 0110 GMT. U.S. gold futures gained 0.1% to $1,958.80.

* The dollar was steady at 99.88, hovering close to its April 2022 lows of 99.58.

* Interest rate futures showed markets were pricing in another rate hike at the Fed’s July 25-26 meeting, with rate cuts seen well into 2024. * Fed Chair Jerome Powell had earlier highlighted the majority view that two additional rate increases would be needed.

* Fed Governor Christopher Waller made the case for tighter policy in the central bank leadership’s final remarks before the blackout on public comments ahead of the July meeting.

* Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
* Speaking to Bloomberg TV on Monday, Treasury Secretary Janet Yellen said she did not expect the U.S. economy to enter into a recession. * Goldman Sachs’ chief economist, Jan Hatzius, said the bank was cutting its probability that a U.S. recession will start in the next 12 months to 20% from an earlier 25% forecast.

* China’s economy grew at a frail pace in the second quarter, raising pressure on policymakers to deliver more stimulus to shore up activity.

* Spot silver fell 0.1% to $24.83 per ounce, platinum was little changed at $976.07 while palladium rose 0.1% to $1,284.91.