Bengaluru — Gold prices were on the back foot on Thursday as the dollar ticked higher but traded in a narrow range as investors turned cautious ahead of the European Central Bank (ECB) meeting and US inflation data later in the day.
Spot gold was down 0.1% at $1,886.66/oz, as of 3.05am GMT.
US gold futures fell 0.4% to $1,888.50/oz.
“Sentiment is neutral and cautious going into CPI [consumer price index] and the ECB meeting tonight,” said IG Market analyst Kyle Rodda, adding that investors expect inflation to be contained, which is keeping a lid on the metals price.
The dollar index edged up slightly to trade near 90.183 against its rivals, making gold more expensive for other currency holders.
All eyes are on the US CPI data due later in the day after May’s report showed consumer prices increased by the most in nearly 12 years in April. Economists polled by Reuters have estimated the CPI advanced 0.4% in May.
The data will be key for gold as a higher print will reignite worries over sooner-than-expected tapering of stimulus measures, which would reduce bullion’s appeal among investors, analysts say.
The ECB policy decision is due at 11.45am GMT. The ECB is all but certain to maintain a generous flow of stimulus when policymakers meet.
On the technical front, spot gold still targets a range of $1,864-$1,877/oz, according to Reuters technical analyst Wang Tao.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.6% on Wednesday.
Elsewhere, silver dipped 0.2% to $27.68/oz, palladium was steady at $2,777.02, while platinum slipped 0.6% to $1,142.93.