Gold prices rose during trading on Thursday, near the $2,400 level per ounce, after a sharp rise in the previous session, with the dollar and bond yields weak after inflation data in the United States strengthened the possibility of the Federal Reserve cutting interest rates as early as September.
Economic data showed that the consumer price index rose by 0.3% in April after increasing by 0.4% in March, which is less than expectations that monthly prices would grow by 0.4%, while retail sales stabilized during the past month, contrary to expectations of a 0.4% increase on a monthly basis.
“Combating inflation and reducing costs is my top economic priority,” President Joe Biden said in a statement released by the White House. “Inflation has fallen more than 60% from its peak, and core inflation has fallen to its lowest levels in three years.”
The dollar fell against a basket of other major currencies, making the greenback-denominated metal cheaper for holders of other currencies. The yield on the 10-year Treasury note also hit its lowest level in more than a month.
“With inflation easing, gold is benefiting from this and looks set to reach $2,400,” said Tim Waterer, chief market analyst at KCM Trade.
However, a potential rise in the dollar or Treasury yields could be the biggest drag on gold prices for the rest of the week, he added.
Economic data showed that the consumer price index rose by 0.3% in April after increasing by 0.4% in March, which is less than expectations that monthly prices would grow by 0.4%, while retail sales stabilized during the past month, contrary to expectations of a 0.4% increase on a monthly basis.
“Combating inflation and reducing costs is my top economic priority,” President Joe Biden said in a statement released by the White House. “Inflation has fallen more than 60% from its peak, and core inflation has fallen to its lowest levels in three years.”
The dollar fell against a basket of other major currencies, making the greenback-denominated metal cheaper for holders of other currencies. The yield on the 10-year Treasury note also hit its lowest level in more than a month.
“With inflation easing, gold is benefiting from this and looks set to reach $2,400,” said Tim Waterer, chief market analyst at KCM Trade.
However, a potential rise in the dollar or Treasury yields could be the biggest drag on gold prices for the rest of the week, he added.
While spot gold contracts rose by about 0.06% to $2,387 per ounce.
On the other hand, the dollar index fell by about 0.02% to 104.195 points.
Other minerals
Spot silver fell 0.4 percent to $29.56 an ounce, after hitting its highest since February 2021 earlier in the session.
Palladium fell 0.2% to $1,009.68.
Platinum rose 0.5% to $1,068.67, its highest level since May 22 of last year.
