4 months ago
67
By Hissay Ongmu Bhutia
(Reuters) – Gold prices rose to their highest level in nearly three weeks on Friday as the dollar and bond yields fell ahead of key U.S. inflation data that could offer more clarity on the Federal Reserve’s interest rates path next year.
Spot gold was up 0.5% to $2,054.50 per ounce as of 1103 GMT and U.S. gold futures rose 0.8% to $2,067.40.
Gold rose to its highest since Dec. 4 earlier in the session and is set for a 1.8% weekly rise, its second in a row.
“If the markets are pricing in so many rate cuts and the dollar and yields are lower, then gold is going to perform really well,” said Craig Erlam, senior markets analyst at OANDA.
Traders are now pricing-in an 83% chance of a U.S. rate cut by March, according to the CME FedWatch tool. Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
Fed officials have been pushing back against the idea of rapid rate cuts next year, but these remarks have done little to change investor sentiment.
The dollar index wobbled near a five-month low, making bullion more attractive to overseas buyers. The benchmark U.S. 10-year bond yields were near their weakest level since July. [US/]
The U.S. November core personal consumption expenditure (PCE) price index report, due at 1330 GMT, could give more clarity on the Fed’s rate policy.
Market participants expect the index to have risen 3.3% on an annual basis, compared with October’s 3.5%.
In other metals, silver gained 0.3% to $24.4727 per ounce. Platinum rose 0.8% to $970.29 and palladium rose 0.6% to $1,220.78. All three metals were on track for their second consecutive week of gains.
(Reporting by Hissay Ongmu Bhutia in Bengaluru. Editing by Jane Merriman)
Disclaimer: This report is auto generated from the Reuters news service. ThePrint holds no responsibilty for its content.
