Spot gold steadied at $1,185.10 an ounce by 0639 GMT, after climbing to $1,190 in the previous session, its highest since June 22.
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Meanwhile, 14 percent of the panelists said they think the Federal Reserve will begin a cycle of short-term interest rate increases starting at its October policy meeting.
“You have the lower interest rates and you have the dollar story”, said Georgette Boele, a strategist at ABN Amro Bank in Amsterdam.
Retail sales data for the US will be released at 8:30 a.m. ET, with strong September auto sales data leading to expectations of 0.2 percent headline growth.
“Prices at $1,150-1,160 are based mainly on pessimism over how soon the Fed is going to hike rates”, Natixis analyst Bernard Dahdah said.
The argument made there by Fischer, and echoed by many Fed watchers and folks on Wall Street, was that with the Fed more or less meeting its labor market goal of “full employment”, inflation need not be running at 2% for the Fed to raise rates.
Lockhart, a centrist on monetary policy, is a voting member of the USA central bank’s rate-setting committee this year.
Tarullo said inflation has not rebounded as one would expect given the recent fall in the USA jobless rate and that there were disinflationary pressures in the global economy, so it was unclear when price increases might accelerate.
The metal, as a non-interest-paying asset, benefitted from ultra-low interest rates following the financial crisis, but fell to 5-1/2 year lows this year on expectations that USA rates would rise for the first time in almost a decade. Another 65 percent expect a hike at the December meeting.
Platinum for January settlement climbed $15.1 to $996.50 per ounce, while the most-actively traded palladium contract stood at $712.35 per ounce. Adding on, she said that even beyond this short term noise, the truth is that there hasn’t really been a big shift to gold and that there are still opinions about the Federal Reserve hiking the results eventually. The greenback wallowed around seven-week lows against a basket of currencies, after weak US data prompted investors to scale back bets that the Fed would hike interest rates by the end of 2015.
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There were also reports overnight that consumer demand for gold in China has seen a significant increase lately.
