Gold Gains Amid US Economic Uncertainty

14 Jan 2025 , 10:52 AM

Amid uncertainties about the objectives of the incoming Trump administration and new positioning ahead of important U.S. data for additional clues on the Federal Reserve’s monetary policy, gold prices rose on Tuesday.

Spot gold increased 0.3% to $2,671.13 an ounce. At $2,688.40, U.S. gold futures increased by 0.4%.

A strong U.S. dollar, supported by positive jobs data last week, reduced investor enthusiasm for the precious metal, causing the bullion to drop around 1% in the most recent session.

As worries mounted that President-elect Donald Trump’s tariffs may drive up inflation, the Fed’s cautious approach to additional rate cuts this year was further supported by the robust jobs data.

According to a New York Federal Reserve survey released on Monday, U.S. consumers had a mixed assessment on the anticipated trajectory of inflation last month.

Although the appeal of the non-yielding asset is diminished by increased interest rates, bullion is employed as a hedge against inflation.

For more information about the economy and the Fed’s policy direction, investors are now anticipating the release of the producer pricing index (PPI) report later in the day and the U.S. consumer price index (CPI) data on Wednesday. This week, a number of Fed officials are also scheduled to speak.

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