Key points:
- Gold purchases by central banks strong in April – WGC
- US payrolls data due out on Friday
Gold prices rose slightly on Wednesday helped by lower Treasury yields, but were stuck in a tight range as investors waited for more U.S. data to gauge the Federal Reserve’s next step on monetary policy.
Spot gold GOLD was up 0.3% at $2,334.81 per ounce, as of 0312 GMT, trading in a narrow $11 range after prices fell 1% in the previous session.
U.S. gold futures 
GOLD rose 0.3% to $2,354.50.
Benchmark 10-year 
US10Y Treasury yields lingered near their lowest level in almost three weeks hit on Tuesday, making bullion more attractive to investors.
“The key event is the ISM services report… the ideal scenario for gold bulls is to see the ISM services remain just below 50 level, with the prices paid component expanding at a slower pace – as this satisfies the ‘soft landing’ scenario the Fed are aiming for,” said City Index senior analyst Matt Simpson.
The U.S. services data is due at 1400 GMT. Markets are also awaiting the ADP employment report due at 1215 GMT on Wednesday and the non-farm payrolls data on Friday for further clues about the health of the U.S. economy and if it will deter the Fed from cutting rates in September. (FEDWATCH)
Higher interest rates increase the opportunity cost of holding the non-yielding asset.
Net purchases of gold by global central banks rose to 33 metric tons in April from a revised net buying of 3 tons in March, the World Gold Council (WGC) said, signaling continuing strong appetite from the sector despite high prices for the metal. This increase in central bank gold purchases indicates confidence in the metal’s value as a safe-haven asset.
Among other metals, spot silver 
XAGUSD1! rose 0.7% to $29.69 per ounce, platinum 
PL1! was up 0.6% at $992.85 and palladium 
XPDUSD1! gained 0.9% to $923.83.
