Gold dips as traders eye US data for Fed clues

15 May 2024 , 09:02 AM

A significant U.S. inflation report that could provide insight into the Federal Reserve’s interest rate trajectory caused gold prices to slightly decline on Wednesday.

Spot gold was down 0.1% at $2,355.24 an ounce. Silver prices increased by 1% on Tuesday. Gold futures were stable at $2,361.10.

The U.S. Consumer Price Index (CPI) data, which is scheduled at 1230 GMT, will be the focus of the markets.

Amidst sharp increases in the costs of goods and services, U.S. producer prices rose more than anticipated in April, suggesting that early in the second quarter, inflation remained high.

In the meantime, Fed Chair Jerome Powell stated that it was doubtful the Fed would need to raise interest rates once more and that he anticipated U.S. inflation to continue decreasing through 2024, as it did last year.

Loretta Mester, president of the Federal Reserve Bank of Cleveland, stated that it was reasonable for the Fed to maintain rate stability while it waits for proof that pricing pressures are lessening.

The opportunity cost of storing non-yielding gold is decreased by lower interest rates.

Spot silver decreased by 0.2% to $28.52 per ounce, while palladium increased by 0.9 to $986.15 and platinum increased by 1.6% to $1,047.73.

For feedback and suggestions, write to us at [e-mail]