Hawkish Fedspeak & Canadian CPI Weigh

Gold is flat in the Asia-Pac session, after closing 0.6% lower at $2319.62 on Tuesday.

• Yesterday’s drop in bullion appeared driven by the latest hawkish Fedspeak. Federal Reserve Governor Michelle Bowman indicated it would likely be "some time" before the FOMC could begin lowering interest rates and warned that U.S. monetary policy might diverge from that of other advanced economies in the coming months.
• Additionally, Canadian CPI inflation data for May came in higher than expected, ending a four-month streak of declining figures. Annual headline inflation rose by 0.2 percentage points to 2.9%, while the average of the median and trim core measures increased by 0.1 percentage points to 2.85%.
• Higher rates are typically negative for gold, which doesn’t pay interest.
• According to MNI’s technicals team, gold continues to trade below resistance and a bear threat remains. The yellow metal has pierced the 50-day EMA at $2,318.3, below which a clear break would open $2,277.4, the May 3 low. Initial firm resistance is $2,387.8, the Jun 7 high.
• Meanwhile, silver underperformed on the day, with the gold-silver cross rising to its highest level since May 17.