Gold prices hovered near a month high on Friday after data suggested easing US price pressures, reassuring investors vouching for a June interest rate cut by the Federal Reserve.
Spot gold edged 0.1% higher to $2,044.60 per ounce, as of 0808 GMT, after hitting $2050.59 on Thursday – its highest level since February 2.
Bullion was headed for a second consecutive weekly gain.
US gold futures were flat at $2,053.00.
”Markets were relieved that there were no nasty surprises in the personal consumption expenditures (PCE) report.
Gold traders rejoiced the fact that core-PCE slowed annually,” City Index senior analyst Matt Simpson said.
Data showed on Thursday PCE inflation in January rose 2.4%, the smallest annual increase since February 2021, after a 2.6% advance in December.
Receding inflationary pressures have helped the Fed to set the table for rate cuts likely later this year. Lower rates boost the appeal of non-yielding bullion.
Money market pricing shows traders are pricing in three quarter-point US rate cuts for 2024.
Investors will watch out for remarks from at least six more Fed officials due later on Friday.
The world’s largest gold-backed exchange-traded fund, SPDR Gold Trust’s holdings fell 3.3% in February and 6.4% so far this year.
”Whilst negative ETF flows are capping gold prices, China’s central bank is a key reason that gold prices remain supported, as they were the second highest purchaser of gold reserves in the fourth quarter,” Simpson said.
Spot platinum fell 0.2% to $871.06 per ounce, and palladium dropped 0.3% to $939.12. Both posted a second monthly decline, with palladium touching more than five-year lows of $849.13.
Platinum group metals producer Impala Platinum said it could shut some of its loss-making South African mining operations if metal prices deteriorate further and restructuring efforts fail to improve margins.
Spot silver fell 0.4% to $22.59 per ounce.
(Edited by : Anshul)
First Published: Mar 1, 2024 5:06 PM IST
