Gold Falls Prior to U.S. Inflation Data

Wednesday morning in Asia, gold prices were lower as investors awaited the U.S. consumer price index (CPI) for additional information on interest rate hikes.

Futures for gold decreased 0.05 percent to $1,851.05 as of 11:01 PM ET (3:01 AM GMT). Wednesday morning, the dollar, which often swings inversely to gold, inched higher.

Janet Yellen, the U.S. Treasury Secretary, stated on Tuesday that inflation might remain elevated, and the Biden administration is likely to boost the 4.7% inflation projection for this year in its budget proposal.

Yellen stated that transactions combining gold and Russia could be sanctioned, and that any attempts to avoid U.S. sanctions using gold are closely monitored.

Monetary policies remain on the minds of investors. They now await the U.S. CPI report on Friday for hints on the course of interest rate hikes.

As inflation, supply disruptions, and rising interest rates remain a concern, the World Bank has lowered its forecast for global growth this year to 2.9%, down from 4.1% in January.

In Asia-Pacific, Japan's first-quarter economy outperformed forecasts, with the country's gross domestic product (GDP) falling by 0.5 percent year-over-year in January-March, compared to the initial estimate of a decline of 1.0 percent released last month.

Tuesday saw the Reserve Bank of Australia increase interest rates to 0.85%.

In terms of other precious metals, silver fell 0.12 percent. Platinum decreased 0.28 percent, whereas palladium increased 0.74 percent.