Gold prices hold ground as investors seek more Fed cues

Gold prices held firm on Wednesday, supported by lower U.S. Treasury yields, although bullion traded in a narrow range as investors stayed on the sidelines awaiting more cues on the Federal Reserve policy. FUNDAMENTALS

* Spot gold was steady at $2,178.31 per ounce, as of 0125 GMT, following two session on gains. * U.S. gold futures edged 0.1% lower to $2,173.70 per ounce.

* U.S. bond yields retreated slightly on Tuesday after strong demand at an auction of $67 billion in five-year notes.

* Investors now look forward to U.S. core personal consumption expenditure price index data due on Friday to gauge when the Fed may begin cutting interest rates.

* Data on Tuesday showed orders for long-lasting U.S. manufactured goods increased more than expected in February, while business spending on equipment showed tentative signs of recovery.

* Gold prices hit a record high last week after Fed policymakers indicated they still expect to reduce interest by three-quarters of a percentage point by 2024 end despite recent high inflation readings. * Chicago Fed President Austan Goolsbee said on Monday at the Fed’s policy meeting last week that he penciled in three rate cuts for this year. * Traders are pricing in a 72% probability that the Fed will begin cutting rates in June, according to the CME Group’s FedWatch Tool. Lower interest rates reduces the opportunity cost of holding bullion.

* SPDR Gold Trust , the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.62% to 830.15 tons in the previous session from 835.33 tons on Monday.

* Meanwhile, China’s net gold imports via Hong Kong slumped about 48% in February to the lowest level since November, data showed on Tuesday.

* Spot silver was steady at $24.42 per ounce, platinum rose 0.1% to $903.70 and palladium eased 0.3% to $990.98.