Gold prices were seen trading below the $1,300 threshold on Wednesday after dropping to its biggest one-day drop in three weeks as investors digest Yellen’s speech on the status of the world’s largest economy and the US central bank’s monetary stimulus.
Gold prices for immediate delivery gained 0.15% to $1,290.90 an ounce at the time of writing, while silver futures edged 0.30% lower to $19.280 an ounce at the same time.
Bullion dropped by 28% in 2013, ending a 12-year rally on worries that the Federal Reserve will reduce its asset purchases.
The yellow metal was supported by the Federal Reserve (Fed) Chair Janet Yellen’s speech on Wednesday, as she gave her speech before US lawmakers in Washington and said the world’s largest economy still needs the stimulus program as the Fed’s targets on inflation and employment are yet to be reached.
The US Federal Reserve has announced cuts to its monthly asset purchases at each of its past four meeting to $45 billion.
Tensions in Ukraine slightly eased on Wednesday after the German Chancellor Angela Merkel and US President Barack Obama decided to vote on whether to impose more sanctions against Russia if the country fails to withdraw its support for separatists.
The Russian President Vladimir Putin said the country will withdraw its troops from the Ukrainian border and also requested to postpone a vote on secession.
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