PRECIOUS-Gold prices steady as US inflation data looms

Credit: REUTERS/ALEXANDER MANZYUK

Feb 27 (Reuters) - Gold prices were steady on Tuesday, as investors awaited a key U.S. inflation reading due later this week that could provide more information on how soon the Federal Reserve might begin cutting interest rates.

FUNDAMENTALS

* Spot gold XAU= was little changed at $2,031.03 per ounce, as of 0056 GMT. U.S. gold futures GCcv1 edged 0.1% higher to $2,040.5 per ounce.

* Benchmark 10-year Treasury yields US10YT=RR slipped to 4.2775% from 4.2990% on Monday, making non-yielding bullion more appealing. US/

* Data on Monday showed sales of rose less than expected in January, while Dallas Federal Reserve monthly manufacturing activity index came out positive.

* Recent remarks from Fed policymakers suggested the U.S. central bank was in no rush to cut interest rates, largely cementing bets against any rate cuts before June.

* Markets are currently pricing in about 80 basis points of rate cuts for 2024, with a 62% chance of the first quarter-point cut coming in June, according to LSEG's interest rate probability app, IRPR. Lower interest rates boost the appeal of holding non-yielding bullion.

* Markets now await data on U.S. durable goods orders due later in the day and the U.S. Federal Reserve's preferred gauge of inflation - the core personal consumption expenditures (PCE) price index - on Thursday.

* Investors were also watching the risk that U.S. government agencies could be shut down if Congress cannot agree on a borrowing extension by Friday.

* Spot platinum XPT= rose 0.2% to $881.75 per ounce, while palladium XPD= fell 0.2% to $949.36, and silver XAG= was flat at $22.52 per ounce.

DATA/EVENTS (GMT)

1330 US Durable Goods Jan

1330 US Consumer Confidence Feb

(Reporting by Harshit Verma in Bengaluru; Editing by Rashmi Aich)

((Harshit.Verma@thomsonreuters.com;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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