Some investors still holding onto gold analyst
Asian shares surge on Wednesday
Gold could pierce alltime highs this year MKS PAMP

March 29 Reuters Prices of safehaven gold dropped on Wednesday as easing fears of a further contagion from the global banking crisis whetted appetite for riskier assets.

Spot gold was trading 0.6 lower at 1,961.80 per ounce, as of 0749 GMT, after rising 1 on Tuesday. U.S. gold futures slipped 0.5 to 1,963.10.

We39;ve seen a natural retracement … gold is pulling back after a failed 39;bid39; to break above 1,975, said Matt Simpson, senior market analyst at City Index.

But some investors still seem to be holding onto gold 39;just in case39; there39;s another skeleton or two lurking in the closet, Simpson said.

The dollar firmed, making bullion expensive for overseas buyers. Asian shares surged on Wednesday.

While gold would ultimately be supported by financial uncertainty, prices could become more volatile over coming weeks if inflation and U.S. economic data stay elevated, Simpson said.

Data on Tuesday showed U.S. consumer confidence unexpectedly increased in March, while February39;s U.S. trade deficit in goods widened modestly.

Analysts at Macquarie, in a note, said they expect the Fed to prioritise bringing inflation back to target with one more rate hike and then no cuts in the early stages of economic contraction, resulting in cyclically weaker gold prices through the second half of 2023.

The opportunity cost of holding…