Gold little changed after U.S. CPI data, Yellen speech ahead

Investing.com - Gold prices steadied below the prior session's eight-week high on Wednesday, as investors awaited a speech from Federal Reserve Chair Janet Yellen for fresh clues about the timing of the next rate hike.

Gold for February delivery on the Comex division of the New York Mercantile Exchange was little changed at $1,213.45 a troy ounce by 9:10AM ET (14:10GMT), after jumping $16.70, or 1.4%, a day earlier.

Prices of the yellow metal rallied to $1,218.90 on Tuesday, a level not seen since November 22, as the U.S. dollar plunged after President-elect Donald Trump warned that the greenback was “too strong” in an interview with the Wall Street Journal.

The dollar index was up around 0.55% to 100.80 early Wednesday, recovering from the previous session's six-week low of 100.23.

Global financial markets will continue to focus on Trump as he takes the Oath of Office and offers his inaugural address on Friday. Investors will welcome any detail he may give on his promises of tax reform, infrastructure spending and deregulation, as well as insight regarding policies on China and the domestic economy.

Trump has been credited with being a major catalyst behind the market's impressive rally since election day, although he has yet to outline his economic policies in detail.

Meanwhile, Fed Chair Yellen is due to speak on the economy and monetary policy at the Commonwealth Club of San Francisco at 3:00PM ET (20:00GMT).

The precious metal has been well-supported in recent weeks amid uncertainty surrounding the Federal Reserve’s pace of interest rate hikes this year.

The Fed had indicated in December that at least three rate increases were in the offing for 2017, according to a forecast of interest rates from members of the central bank, known as the dot-plot.

However, traders remained unconvinced. Instead, markets are pricing in just two rate hikes during the course of this year, according to Investing.com’s Fed Rate Monitor Tool.

A delay in raising interest rates would be seen as positive for gold, a non-interest-bearing asset, and negative for the dollar.

On the data front, U.S. Commerce Department said that consumer prices gained 0.3% in December, in line with expectations and after a 0.2% advance the previous month.

Year-over-year, consumer prices increased 2.1% last month, the biggest year-on-year gain since June 2014, a sign that inflation pressures could be building.

Also on the Comex, silver futures for March delivery was up 3.0 cents, or about 0.2%, at $17.17 a troy ounce during morning hours in New York.

Meanwhile, platinum fell 1% to $972.85, while palladium dipped 1% to $745.83 an ounce.

Elsewhere in metals trading, copper futures dropped 1.3 cents, or 0.5%, to $2.612 a pound.

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