Gold steadies as dollar stalls; focus on Jackson Hole event

Aug 24 (Reuters) – Gold steadied on Wednesday as the dollar gave up some gains from earlier in the session, while investors await the Jackson Hole central bankers’ event for clues on rate hikes.

Spot gold was up 0.1% at USD 1,749.35 per ounce by 2:29 p.m. ET (1829 GMT). It rose as much as 1% in the previous session.

US gold futures settled unchanged at USD 1,761.5.

Helping gold reverse some initial declines, the dollar stalled around the 108.6 level, after climbing as high as 109.112 earlier in the session.

A stronger dollar tends to dull appetite for gold among overseas buyers.

“The market is relatively quiet. Metal traders are waiting to see what comes out of the Jackson Hole meet and want to know more about Fed’s rate hike path,” said Bob Haberkorn, senior market strategist at RJO Futures.

Market participants await US Federal Reserve Chair Jerome Powell’s speech at the Jackson Hole Economic Policy Symposium on Friday. The speech could throw some light on the Fed’s monetary policy tightening path.

Gold tends to perform poorly if rates rise, as it yields no interest.

“Whether gold breaks USD 1,730 or not may well depend on what Powell has to say as well as whether traders are in the mood to listen, should he stick to his colleague’s hawkish script,” Craig Erlam, senior market analyst at OANDA wrote in a note.

Investors also await estimates for US second-quarter gross domestic product, and July consumer spending data due later this week.

Spot silver fell 0.7% to USD 19.03 per ounce.

“A mix of negative factors, including fear of recession, rising interest rates and a strong dollar, hit the price of the industrial metal hard,” aid Carlo Alberto De Casa, external analyst for Kinesis Money.

Platinum fell 0.6% to USD 874.64 per ounce while palladium rose 2.5% to USD 2,029.21.

(Reporting by Ashitha Shivaprasad and Seher Dareen in Bengaluru; Editing by Shinjini Ganguli and Vinay Dwivedi)