Ahead of important US inflation statistics, gold trades in a narrow range

13 Feb 2024 , 11:27 AM

Tuesday’s tight range in gold prices was caused by investors staying away from large wagers ahead of a U.S. inflation report that may provide new insight into the timing and magnitude of the Federal Reserve’s potential rate cuts this year.

Spot gold was unchanged at $2,020.28 per ounce (Oz), moving within a narrow $3 range.

At $2,033.90/Oz, U.S. gold futures were essentially unchanged.

Due to the Lunar New Year holiday-related closure of the markets in China and Hong Kong, a low trading volume is anticipated.

Monday’s closing price for bullion was 0.2% lower, following a brief dip to $2,011.72/Oz, the lowest level in almost two weeks.

Throughout the day, everyone’s attention was focused on the U.S. consumer price index (CPI) statistics for January. According to a New York Fed survey, Americans’ expectations for inflation were largely steady at the beginning of the year.

A Reuters poll indicates that Wall Street economists anticipate the year-over-year CPI to increase by 2.9%, down from 3.4% in the previous month. Additionally, it is anticipated that the core CPI’s year-over-year growth in January decreased to 3.7% from 3.9% in December.

As per LSEG’s Interest Rate Probability software, IRPR, traders anticipate a roughly 62% probability of a rate cut by the Fed in May.

Spot silver was stable at $22.70, spot palladium increased 0.3% to $894.38, and spot platinum was unchanged at $888.88 per ounce.

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