13.05.202110:41:00UTC+00Gold Slides Amid Rate Hike Fears

Gold prices edged lower on Thursday to extend losses from the previous session after unexpectedly strong U.S. consumer price data spurred bets on a change in tone from the Federal Reserve.

Spot gold dipped 0.3 percent to $1,810.64 per ounce, after having fallen over 1 percent on Wednesday. U.S. gold futures were down 0.7 percent at $1,810.45.

Overnight data showed U.S. consumer inflation rose at its fastest rate since 2008 last month, raising worries about whether the Fed will have to tighten its monetary policy sooner than it would like.

Benchmark U.S. 10-year Treasury yields jumped to their highest in more than a month and the dollar rose against its rivals despite Fed officials playing down the risk of inflation.

Fed Vice Chair Richard Clarida said on Wednesday that the U.S. central bank continues to believe the sharp price increases over the past two months are due to the rebound following the unprecedented shock inflicted by the Covid-19 pandemic and will not last.

U.S. producer price data for April and weekly jobless claims figures, due later in the session may sway sentiment as the day progresses.