Gold Treads Water Ahead of Key US Inflation Report

10 Jul 2024 , 09:32 AM

Gold prices remained stable on Wednesday, as investors awaited critical US inflation data that could give further light on the Federal Reserve’s interest rate path.

Spot gold was slightly off at $2,365.09 an ounce. Futures for US gold increased by 0.2% to $2,372.60.

Fed Chair Jerome Powell stated that “more good data would strengthen” the case for looser monetary policy, noting that inflation had improved recently in statements to Congress. He did not, however, want “to be sending any signals about the timing of any future actions” on rates, he said lawmakers.

With regard to a rate cut in September, traders presently perceive a 73% possibility, according to the FedWatch Tool from the CME Group. The appeal of non-yielding bullion usually shines at lower interest rates.

The consumer price index (CPI) data, which is due on Thursday, is now the focus of the market. It is anticipated to reveal that core prices increased by 0.2% while headline prices increased by 0.1% for the month. Accordingly, the yearly increases would be 3.1% and 3.4%, respectively.

According to data released on Tuesday, concerns about inflation persisted even though small-business optimism in the US reached a six-month high in June.

June saw inflows into globally traded gold exchange-traded funds (ETFs) for the second straight month as a result of holding increases by funds listed in Europe and Asia, according to a report released on Tuesday by the World Gold Council (WGC).

Spot silver decreased by 0.1% to $30.77, palladium remained unchanged at $980.49, and platinum increased by 0.3% to $986.80.

To provide a domestic price-hedging mechanism, the Guangzhou Futures Exchange announced on Tuesday that it intends to introduce its first platinum and palladium futures contracts in China, the second-largest economy in the world.

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