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​PRECIOUS-Gold prices subdued as investors await U.S. inflation data

·         Gold prices were little changed on Tuesday, as investors awaited key U.S. inflation data that could offer cues on the Federal Reserve’s decision to taper stimulus measures meant to aid economic recovery from the pandemic.

·         Spot gold inched 0.1% lower to $1,792.31 per ounce by 0657 GMT, U.S. gold futures were flat at $1,793.60.

·         “A modest acceleration (in inflation) reinforces the idea that the Fed is likelier to make a more formal announcement that a taper is imminent,” DailyFX currency strategist Ilya Spivak said.

·         “The reaction from gold is going to be negative because the prospect of reducing stimulus is something that bids up yields.”

·         U.S. consumer price data is due at 1230 GMT. Economists expect core CPI, an index that strips out volatile energy and food prices, to have risen 0.3% in August from the prior month.

·         “Another heightened print may serve as a data point challenging some Federal Reserve policymakers’ views that inflation will be transitory,” Avtar Sandu, a senior commodities manager at Phillip Futures, said in a note.

·         The data comes ahead of the key policy meeting by the Federal Reserve on Sept. 21-22, where markets will keep a close eye on central bank’s announcement on when it will start winding up its pandemic-era bond-buying programme.

·         On the technical front, spot gold may retest a resistance at $1,798, and a break above could lead to a gain at $1,807, according to Reuters technical analyst Wang Tao.

·         The dollar index was steady after hitting a two-week high on Monday.

·         SPDR GOLD HOLDINGS:

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Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.2% to 1,000.21 tonnes on Monday from 998.17 tonnes on Friday.

·         Gold Price Analysis: XAU/USD to sink towards $1,750 on a break below $1,785

XAU/USD holds in a familiar trading range below $1,800. Investors look forward to the US CPI report for some impetus ahead of the FOMC policy meeting.

Higher inflation could persist for some time

“A stronger US CPI report will reaffirm marked expectations for an imminent Fed taper announcement. This would be enough to trigger a fresh leg up in the US bond yields, which should provide an additional boost to the already stronger greenback. This, in turn, will play a key role in influencing the XAU/USD ahead of the crucial FOMC monetary policy meeting on September 20-21.”

“The $1,785-84 region might continue to protect the immediate downside. A convincing break below will be seen as a fresh trigger for bearish traders and set the stage for a deeper retracement to the $1,750 level.”

“The $1,800-05 area now seems to have emerged as immediate strong resistance and is closely followed by the very important 200-day SMA, around the $1,808 zone. A sustained move beyond might prompt some short-covering move and lift the metal back towards the $1,832-34 supply zone.”

·         Silver fell 0.1% to $23.69 per ounce, platinum dipped 0.4% to $957.33, while palladium slipped 0.7% to $2,072.78.

·         Dodd-Frank architects call for reappointment of Fed's Powell

The Democratic architects of a key overhaul of U.S. financial regulation a decade ago called on President Joe Biden to reappoint Fed Chair Jerome Powell to a second term, rebuffing arguments he has been weak on regulatory issues.

·         Storm Nicholas threatens U.S. Gulf Coast with dangerous conditions

The Gulf Coast of Texas and Louisiana was bracing on Monday for the arrival of Tropical Storm Nicholas, which was expected to batter the region with life-threatening storm surge, flash flooding and gusty winds.

·         More workers are facing compulsory Covid vaccination or no job

·         UK employee numbers surge above pre-pandemic level

British employers added a record 241,000 staff to their payrolls last month, lifting the total number of payrolled employees just above the level they were before Britain first went into a COVID-19 lockdown last year, official data showed on Tuesday.

·         Chinese envoy to U.S. urges stable commercial ties despite trade conflicts

·         Japan's Taro Kono upends race for next premier

·         Japan LDP's Ishiba set to back Kono in leadership race - report

Shigeru Ishiba, a top politician in Japan's ruling party, will not stand in the race to replace the prime minister and is set to back Taro Kono, NHK television said on Tuesday, boosting Kono's chances of taking the premiership.

·         Japan's Q3 growth forecast more than halved on COVID-19 impact

Japan's export-reliant economy will grow at less than half the pace in the current quarter than thought just one month ago, held back by local coronavirus outbreaks and the impact from the pandemic abroad, a Reuters poll found.

But economists said the world's third-largest economy would not shrink in July-September, with modest growth forecast to pick up next quarter, although also at a weaker pace than predicted in the July poll.

Japan's economy was seen expanding an annualised 1.2% this quarter, the Sept. 3-13 poll of about 40 economists showed, down from a 2.7% expansion projected last month and 4.2% growth forecast in July.

·         Indonesia govt, key parliamentary body set 2022 GDP growth target at 5.2%

·         Malaysia’s government seeks $11 billion more in Covid fund, higher debt ceiling: Finance minister

Malaysia’s government will seek parliamentary approval to increase funds for Covid-19 support measures and raise the country’s statutory debt ceiling, Finance Minister Tengku Zafrul Aziz told CNBC on Tuesday.

·         COVID-19 cases in southeast China more than double as Delta spreads

·         New Zealand looks to boost COVID-19 vaccinations as new cases ease