With a focus on American data, gold creeps higher on a weaker dollar

27 Feb 2023 , 07:58 AM

Friday saw a little increase in gold prices as the U.S. dollar weakened and traders awaited economic data due later in the day to determine the Federal Reserve’s stance on rate hikes.

Spot gold was up 0.1% at $1,824.88 per ounce after falling to a 2-month low the previous day. Futures for U.S. gold increased 0.3% to $1,831.40.

The price of bullion is down 0.9% so far this week.

With the dollar index retreating from its seven-week high reached on Thursday, purchasers holding other currencies will pay less for metal.

The number of people submitting new unemployment insurance claims unexpectedly decreased last week, indicating that the labour market remains tight.

The fourth quarter’s gross domestic product growth estimate was revised downward on Thursday from the previously reported 2.9% pace to a 2.7% annualized rate.

According to a different report released on Thursday, the fourth-quarter personal consumption expenditures (PCE) price index increased at an increased rate of 3.7% compared to the first estimate of 3.2%. The improvements suggest that the January PCE price index readings—due at 1330 GMT—will be higher.

Fed funds futures traders anticipate that benchmark rates will reach a peak of 5.343% in July and stay above 5% for the duration of the year.

Although rising interest rates reduce the appeal of the non-yielding asset, gold is nonetheless regarded as a hedge against inflation.

Spot silver increased by 0.2% to $21.34 per ounce, while platinum and palladium both fell by 0.1% to $945.94 and $1,447.60, respectively.

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