Gold Holds Steady as Global Markets React to Central Bank Moves

Gold prices remained stable on Wednesday in Asia and London, maintaining Tuesday's rally and nearing two-week highs against the Chinese Yuan. Beijing's announcement to trade government bonds to prevent a banking crash similar to Silicon Valley's influenced this stability, although it clarified this isn't the start of QE.

With the Yuan and Dollar slipping, gold prices in other currencies softened. Gold in Euros fell by nearly €20 per ounce to €1865, while UK gold prices dropped £10 to £1830 despite a three-year low inflation rate and the Bank of England's anticipated rate decision to hold at 5.25%.

Fitch Ratings noted weakened demand in China due to a property market collapse and low consumption growth, while former PBoC policymaker Yu Yongding suggested readiness for QE if needed. Current PBoC chief Pan Gongsheng stressed bond trading doesn't equate to QE but is necessary to prevent financial risks.

Chinese gold prices hit their highest since June 7 at ¥549 per gram, and Shanghai silver also rose. London silver prices in USD increased to $29.50 per ounce. Federal Reserve Governor Adriana Kugler highlighted inflation risks, with gold in USD holding just below $2330 per ounce, close to its all-time high from April but 4.9% below last month's peak.