Gold Prices Recover Slightly as Investors Await U.S. Inflation Data After Powell's Hawkish Comments

13 Nov 2023 , 09:34 AM

Gold prices inched higher on Monday as investors turned their attention to U.S. inflation data following the hawkish comments from Federal Reserve Chair Jerome Powell, which had driven bullion to its lowest level in more than three weeks last week.

As of 0102 GMT, spot gold was up 0.1% at $1,939.19 per ounce, recovering from its lowest level since October 18 on Friday. U.S. gold futures also gained 0.3% to reach $1,943.40.

Gold faced a 2.8% decline last week, marking its worst performance in over a month, as Powell’s hawkish statements dampened expectations of any imminent interest rate cuts. The prospect of higher interest rates tends to increase the opportunity cost of holding gold.

A survey revealed that U.S. consumer sentiment fell for the fourth consecutive month in November, coupled with a rise in households’ expectations for inflation. This week’s focal point will be the U.S. Consumer Prices Index (CPI) data scheduled for Tuesday, which could influence the Federal Reserve’s interest rate outlook.

The holdings of the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, reported a 0.10% increase to 868.14 tonnes on Friday from 867.28 tonnes on Thursday.

In India, gold demand witnessed improvement last week due to a major festival, although early reports suggested that purchases were marginally lower compared to last year, primarily due to elevated prices deterring some customers.

Meanwhile, spot silver rose 0.3% to $22.68 per ounce, platinum remained flat at $859.66, and palladium gained 0.8% to $999.71 per ounce, holding near its lowest level since 2018.