* U.S. 10-year yields hover near 1-month low
* Fitch Solutions sees more upside to gold in next few months
* China’s May factory gate prices rise at fastest in over 12 yrs (Recasts, adds comments, updates prices)
June 9 (Reuters) - Gold prices held steady on Wednesday as bond yields remained under pressure, with investors on the sidelines ahead of more data on U.S. inflation and the European Central Bank policy meeting.
U.S. benchmark 10-year Treasury yields were hovering near more than a month low, while the dollar index held steady.
Spot gold was up 0.1% at $1,893.89 per ounce, as of 0331 GMT.
U.S. gold futures rose 0.1% to $1,896.60
“What I am looking at is the build-up to the FOMC meeting ... the Fed may start to discuss about taper and this is getting highlighted,” Stephen Innes, managing partner at SPI Asset Management, said.
“The market is still of the opinion that it (the Fed) is going to a dovish taper and we have inflation aspects, which should be relatively positive for gold.”
The U.S. consumer price index report due on Thursday is expected to provide more clues on when the Federal Reserve will dial back monetary stimulus. The ECB policy meeting is also scheduled on the same day.
The U.S. central bank is expected to hold its policy meeting next week.
U.S. Treasury Secretary Janet Yellen on Sunday noted that a slightly higher interest-rate environment “would be a plus for society’s point of view and the Fed’s point of view.”
Data out of China showed May factory gate prices rose at their fastest pace in over 12 years, while consumer prices increased for the third straight month.
“We expect further gains (to gold) in the coming months amidst rising inflation pressuring US treasury real yields, a weak U.S. dollar and renewed waves of COVID-19 infections gripping countries across the world,” Fitch Solutions said in a note.
Among other precious metals, silver rose 0.2% to $27.68 per ounce, palladium was steady at $2,808.75, while platinum gained 0.1% to $1,162.57.
(Reporting by Brijesh Patel in Bengaluru)
Source: Reuters