Gold inches lower on expectations of more rate hikes

Dec 19 (Reuters) – Gold prices eased in early Asian hours on Monday, as the market expected more interest rates hikes in the next year by the US Federal Reserve.

* Spot gold was down 0.1% at USD 1,791.25 per ounce as of 0010 GMT. US gold futures were little changed at USD 1,800.70.

* Fed policymakers may need to lift US borrowing costs above the peak 5.1% they penciled in just this week, and keep them there perhaps into 2024 to squeeze high inflation out of the economy, three of them signaled on Friday.

* Higher interest rates tend to weigh on the bullion’s appeal, as it increases the opportunity cost of holding the non-yielding asset.

* The dollar index was up 0.1%. A stronger greenback makes gold more expensive for overseas buyers.

* Indian gold dealers offered bigger discounts to attract consumers who delayed purchases due to a spike in prices last week, while China’s reopening plans have kept premiums firm in the world’s top bullion buyer.

* SPDR Gold Trust GLD, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.4% to 910.40 tonnes on Friday.

* Spot silver fell 0.3% to USD 23.14, platinum rose 0.3% to USD 994.53 and palladium was up 1.1% to USD 1,732.59.

DATA/EVENTS (GMT, Dec)

0900 Germany Ifo Business Climate New

0900 Germany Ifo Curr Conditions New

0900 Germany Ifo Expectations New

(Reporting by Ashitha Shivaprasad in Bengaluru; Editing by Rashmi Aich)