Gold backs off 1-week high with US inflation data in focus

Gold prices fell on Wednesday, for the first time in 4 days, and pulled back from a 1-week high due to profit-taking, ahead of the US inflation data, which provide cues about the timing of the first US interest rate hike this year.

Gold prices fell 0.4% to $1,814.68 an ounce, after opening at $1,821.18, and hit a day high at $1,822.54.

Gold gained 1.1% yesterday, the third daily gain in a row, and the largest daily gain since December 16, and hit a 1-week high at $1,823.24

This biggest gain in 2022 came thanks to a drop in the US 10-year Treasury bond yields, following Federal Reserve Chairman Jerome Powell's statements before Congress.

Jerome Powell said the decision to cut down the Federal Reserve's $9 trillion general budget could take a few months.

At 13:30 GMT, the US consumer price index reading will be released, which is expected to rise by 7.0% y/y in December from 6.8% in November, and the monthly reading is expected to rise by 0.4% from 0.8%.

Gold stocks at the SPDR ETF fell 0.87 metric tonnes yesterday, with the total at the lowest since December 28 at 976.21 metric tonnes.