Gold slips on firm dollar, Fed symposium in focus

GOLD - NEW DELHI. Gold prices fell on Wednesday, weighed by an uptick in the dollar and buoyant risk appetite, as investors awaited Federal Reserve Chairman Jerome Powell's speech this week for guidance on the central bank's taper plans.

Spot gold was down 0.5% at $1,793.50 per ounce by 0704 GMT, while U.S. gold futures fell 0.7% to $1,795.90.

The dollar index inched 0.1% higher, denting gold's appeal for those holding other currencies, while Asian shares held onto their recent gains.

"The higher equity markets, the risk-on narrative... (are) really diminishing the need for gold as a hedge," said Stephen Innes, managing partner at SPI Asset Management.

The coronavirus curve in some hotspots is easing and the U.S. Food and Drug Administration's approval of vaccinations should also bring down the curve, Innes said.

The U.S. drug regulator granted full approval on Monday to the Pfizer Inc/BioNTech SE COVID-19 vaccine, raising hopes inoculations could accelerate.

Investors are now awaiting Powell's speech at the Fed's annual economic symposium at Jackson Hole, Wyoming, on Aug. 27 to see if he gives a timeline for the withdrawal of monetary stimulus.

The Fed is likely to "talk about the concept of tapering, but they won't give a timeline," IG Market analyst Kyle Rodda said.

"Everyone is willing to take a punt that they're going to maybe take a softer stance to tapering this weekend, and it's a good thing for gold."

Gold is considered a hedge against inflation and currency debasement likely to result from widespread stimulus measures.

Spot gold may retreat to $1,773, having failed to break resistance at $1,800 and a falling trendline, according to Reuters technical analyst Wang Tao.

Holdings in the world's largest gold-backed exchange-traded fund, SPDR Gold Trust, again fell to their lowest level since April 2020 on Tuesday.

Silver fell 0.7% to $23.68 per ounce, while platinum dropped 1.7% to $994.49. Palladium was down 1.8% to $2,429.99.