Gold prices were flat on Wednesday, as traders focused on U.S. inflation data for rate clues after less hawkish comments from the Federal Reserve chief fuelled a bullion rally last session.

FUNDAMENTALS

* Spot gold was little changed at $1,819.51 per ounce by 0135 GMT. U.S. gold futures were up 0.1% at $1,819.80.

* Fed Chairman Jerome Powell said the central bank was determined to ensure that high inflation did not become “entrenched,” and that far from diminishing job growth, a turn to higher policy interest rates and a runoff of its asset holdings was necessary to keep the current economic expansion underway.

* Benchmark 10-year yields dipped as more aggressive rate hikes are also seen as likely to dent growth and inflation longer-term. The yield had reached 1.808% on Monday, its highest since Jan. 21, 2020.

* Gold is considered a hedge against higher inflation, but the metal is highly sensitive to rising U.S. interest rates which increase the opportunity cost of holding non-yielding bullion.

* The dollar slid to its weakest since November against major peers, after Powell said it may take several months to make a decision on running down the central bank’s $9 trillion balance sheet.

* U.S. inflation data is due at 1330 GMT, with core CPI, which excludes food and energy prices, seen rising by 5.4%, its highest in decades and up from 4.9% in the prior month.

* Spot silver shed 0.1% to $22.73 an ounce, platinum fell 0.4% to $967.43, and palladium was flat at $1,920.67.