Gold Steady as US Inflation Data Looms

13 Nov 2024 , 09:36 AM

As focus went to a significant U.S. inflation report that was due later in the day and could provide additional insight into the Federal Reserve’s monetary policy trajectory, gold prices hardly moved on Wednesday.

After falling to its lowest level since September 20 in the previous session, spot gold was steady at $2,599.19 per ounce. At $2,605.10, U.S. gold futures were stable.

Amid fears that Republican President-elect Donald Trump will impose inflationary import tariffs, the U.S. dollar hovered around a 6-1/2-month high. For other currency holders, greenback-priced-bullion is more costly when the dollar is stronger.

According to CME’s FedWatch Tool, markets have been reducing their expectations for additional rate reduction from the Fed. As of right now, they are pricing in a 60.4% chance of a 25 basis point decrease at its December meeting, down from 77.3% a week ago.

Although gold is employed as an inflation hedge, its appeal is diminished by higher rates because it pays no interest.

The U.S. Consumer Price Index (CPI) data, which is due at 1330 GMT, is the market’s main focus. The Producer Price Index (PPI), weekly unemployment claims data on Thursday, and retail sales data on Friday are among the other data sets that are coming this week.

Investors are also keeping an eye on comments made by Fed Chair Jerome Powell and other US central bank officials.

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