Ammon News - Gold prices edged lower on Wednesday as caution prevailed ahead of the U.S. consumer price inflation report that could provide more clarity on the Federal Reserve's interest rate trajectory.

Spot gold eased 0.1% to $2,675.72 per ounce by 0533 GMT. U.S. gold futures gained 0.3% to $2,690.60.

A Reuters poll forecast an annual rise of 2.9% versus 2.7% in November and a monthly increase of 0.3%.

Data on Tuesday showed U.S. producer prices increased moderately in December, but that is unlikely to change views that the Fed would not cut interest rates again before the second half of this year amid labour market resilience.

Traders have fully priced in a pause in rate cut at the Fed's January policy meeting.

With President-elect Donald Trump set to begin his second term next week, the focus remains on his policies that analysts expect would fuel inflation.

Non-yielding bullion is used as a hedge against inflation, although higher interest rates diminish its appeal.

According to Reuters technical analyst Wang Tao, spot gold may fall towards $2,635.

Spot silver shed 0.2% to $29.83 per ounce and palladium dropped 0.2% to $936.92. Platinum steadied at $935.25. Reuters