By Eileen Soreng
(Reuters) – Gold prices held steady on Tuesday, as concerns over a potential fallout of Chinese property developer Evergrande’s unsolved debt crisis provided some respite to the safe-haven metal against a firmer dollar and elevated U.S. Treasury yields.
Spot gold was steady at $1,749.86 per ounce by 0454 GMT, while U.S. gold futures edged 0.1% down to $1,749.80.
“Gold seems content to range between $1,740 and $1,760 at the moment with Asian buyers adding to longs on dips with Evergrande and China growth fears encouraging regional buyers to add more weight in gold as a haven play,” Jeffrey Halley, senior market analyst for Asia Pacific at OANDA said.
Investors continued to fret over China Evergrande Group, which has 30 days to make the payment before it falls into default while its wealth management unit is now being investigated.
But, bullion prices were capped by a stronger dollar and higher benchmark U.S. 10-year Treasury yields that hovered near a three-month peak.
Investors now eye Congressional testimony from U.S. Federal Reserve Chair Jerome Powell due later in the day, after he said the central bank would move against unchecked inflation if needed.
U.S. central bank officials also tied reduction in Federal Reserve’s monthly bond purchases to continued job growth, with a September employment report now a potential trigger for the central bank’s bond “taper.”
While gold is often considered a hedge against higher inflation, a rate hike would increase the opportunity cost of holding gold, which pays no interest.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.3% to 990.32 on Monday.
Silver fell 0.3% to $22.59 an ounce.
Platinum was flat at $980.62, while palladium rose 0.2% to $1,968.83.
(Reporting by Eileen Soreng in Bengaluru; Editing by Ramakrishnan M., Rashmi Aich and Sherry Jacob-Phillips)
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