Gold edges high

GOLD edged higher yesterday, snapping two-days of losing streak, and recovered a part of the overnight slump back closer to YTD lows.

The incoming US economic data, with the latest PPI print showing that wholesale prices rose at the fastest yearly rate in almost seven years, reaffirmed expectations that the Fed would hike interest rates at least two more times in 2018 and prompted some aggressive selling around the non-yielding yellow metal on Wednesday.

This coupled with firming US Dollar, amid intensifying trade rhetoric between the world’s two largest economies, exerted some additional downward pressure and further collaborated to the commodity’s sharp decline to over one-week lows.

The bearish pressure eased a bit on Thursday, with traders opting to lighten their bearish bets ahead of today’s key release of the US consumer inflation figures. However, signs of stability in global financial markets, coupled with a mildly positive tone around the greenback might continue to keep a lid on any meaningful up-move for dollar-denominated commodities — like gold.

A subsequent up-move beyond the $1247-48 immediate resistance is likely to confront fresh supply near the $1 252 level, above which the metal could head back towards challenging a strong hurdle near the $1257-58 region. — FXStreet.