Gold prices edged higher on Wednesday, bouncing off the prior session's three-week low as focus remained on U.S. stocks, which were the source of the latest turbulence in global markets.
Comex gold futures were at $1,333.00 a troy ounce by 3:10AM ET (0810GMT). That was up around $3.00, or 0.25%, from their last settlement. Prices touched their lowest since Jan. 12 at $1,322.80 in the last session.
Gold futures closed lower for a third straight session on Tuesday, as U.S. equities bounced back from their worst one-day selloff in six years and the dollar held relatively steady.
The yellow metal found support after the rebound in Asian markets stalled Wednesday as several indexes in the region gave up early gains to finish the session in negative territory.
Major U.S. stock index futures were also pointing to a sharply lower open, with Dow futures falling around 1%, a sign that market participants remain jittery amid this week’s global markets rout.
There was no obvious single reason behind massive losses seen stateside, but the sell-offs were blamed on concerns about rising interest rates, program trading and volatility funds that use leverage.
Unless the market plunge intensifies and damages the economy, the Federal Reserve is unlikely to budge from its plan to raise borrowing costs three times this year, some analysts said.
However, traders have already dialed back bets the U.S. central bank would speed up the pace of rate hikes to between two and three hikes from three to four hikes last week, according to Investing.com's Fed Rate Monitor tool.
Gold is highly sensitive to rising rates, which increase the opportunity cost of holding nonyielding bullion.