Gold retreats as dollar, yields climb after Fed's Powell comments
Dollar regains footing after hitting over 1-year low
U.S. 10-year bond yields hit one-week high
Gold hits record high of $2,599.92 per ounce
Recasts, adds analyst comments and updates prices
By Anushree Mukherjee and Brijesh Patel
Sept 18 (Reuters) -Gold prices slipped from all-time highs on Wednesday, as the dollar and Treasury yields rose on the back of comments from Federal Reserve Chair Jerome Powell after the U.S. central bank delivered a bumper 50-basis-points (bps) rate cut.
Spot gold XAU= was down 0.7% at $2,552.49 per ounce as of 04:07 p.m. ET (2007 GMT), after hitting a record high of $2,599.92 in the wake of the Fed's rate decision.
U.S. gold futures GCcv1 settled 0.2% higher at $2,598.60.
"Gold is retracing rapidly as the dollar rallies after Powell was steadfastly neutral - the Fed will be data-dependent and the market should not assume that 50 bps is the new pace," said Tai Wong, a New York-based independent metals trader.
"Gold is in a bull market and dips will be bought," he added.
The U.S. central bank kicked off what is expected to be a steady easing of monetary policy with half a percentage point cut and policymakers see the Fed's benchmark rate falling by another half of a percentage point by the end of this year.
Meanwhile, Powell said that even as inflation pressures have clearly ebbed, he is not ready to say price pressures have definitively cooled.
The dollar =USD rose back up after hitting an over one-year low, making gold less attractive for other currency holders. The benchmark 10-year yield US10YT=RR rose to a one-week high. USD/
"The Fed could be willing to cut in larger increments if the labour market loosens... and that is a benefit for gold as a long duration zero coupon asset," said Aakash Doshi, head of commodities, North America at Citi Research.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
"We expect the Fed projection of further rate cuts to support investment demand, e.g. with further inflows into gold ETFs, while gold demand from central bank is likely to remain strong," said UBS analyst Giovanni Staunovo.
Spot silver XAG= dipped 2.5% to $29.96 per ounce. Platinum XPT= slipped 1.1% to $970.10. Palladium XPD= fell 5.4% to $1,056.28.
Reporting by Anushree Mukherjee and Brijesh Patel in Bengaluru; Editing by Krishna Chandra Eluri
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