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Gold Subdued As Dollar Rebounds

Gold prices were little changed in lackluster trade on Wednesday, with recession risks and rising geopolitical tensions in the Middle East helping limit the downside. Spot gold was marginally lower at $1,970.40 per ounce, while U.S. gold futures were down 0.2 percent at $1,981.25.

The dollar rose against a basket of currencies, pressuring dollar-denominated commodities including bullion.

Investors kept a wary eye on the situation in the Middle East amidst reports of an imminent ground invasion of Gaza by Israel.

Amid lingering fears over further policy tightening by the Federal Reserve, traders looked ahead to the release of the U.S. GDP numbers for the third quarter on Thursday and the PCE price index on Friday for further direction.

Meanwhile, Chinese developer Country Garden Holdings Co has reportedly defaulted on a dollar bond for the first time ever, underscoring the depth of the problems in the country’s property sector.

As risks mount, China announced plans to issue sovereign bonds worth 1 trillion yuan ($137 billion) in an effort to support recovery amid sluggish growth.

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