Gold climbs after soft US inflation data; still set for weekly loss
Gold prices extended gains on Friday, supported by a softer dollar and Treasury yields after U.S. economic data indicated a slowdown in inflation, although the Federal Reserve's hawkish interest rate outlook kept bullion on track for a weekly loss.
Spot gold was up 0.8% at $2,614.67 per ounce, as of 9:42 a.m. ET (1442 GMT) and U.S. gold futures climbed 1% higher to $2,633.20.
The dollar (.DXY), opens new tab fell 0.4% from its two-year high, making gold less expensive for overseas buyers, while Treasury yields edged down from an over six-month high.
The report showed that monthly inflation slowed in November after showing little improvement in recent months. The personal consumption expenditures (PCE) price index rose 0.1% last month after an unrevised 0.2% gain in October.
Bullion is down 1.3% this week so far after the Fed's "dot plot" on Wednesday showed only two 25-bps rate cuts by 2025, signalling less easing than projected in September.
"With physical demand holding a floor for now, this means we are now heading into a 2025 that has relatively low Fed cut expectations, something that could fuel gold gains if inflationary fears end up being overblown, allowing the Fed more maneuverability," JP Morgan said in a note.
Spot silver rose 1% to $29.30 per ounce but was headed for its worst week since late July 2024.
Source: Reuters
