Gold rangebound as US CPI data takes the limelight
Investors await US inflation data for hints on the size of the Fed’s potential rate cut next week
11 September 2024 - 07:39
byDaksh Grover
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Bengaluru — Gold prices steadied on Wednesday, as investors keenly awaited the US inflation data for hints on the size of the Federal Reserve’s potential interest rate cut next week.
Spot gold held its ground at $2,518.22/oz by 3.19am GMT. US gold futures rose 0.2% to $2,547.10.
“Gold is rangebound in a well-supported market ahead of a key US inflation report,” said City Index senior analyst Matt Simpson, adding that data is likely to show soft inflation and send gold to a record high.
The US consumer price index (CPI) data is due at 12.30pm GMT, while the producer price index (PPI) reading and initial jobless claims are due on Thursday.
The CPI report is expected to show inflation nearing the Fed’s 2% target, supporting chair Jerome Powell’s view that price growth is under-control, and play a pivotal role in determining the size of the rate cut next week.
The Fed will lower interest rates by 25 basis points (bps) at each of the three remaining policy meetings in 2024, according to a majority of economists in a Reuters poll.
Zero-yield bullion tends to be a preferred investment amid lower interest rates and geopolitical turmoil.
“I see good support for gold prices around $2,450-$2,460. By year-end, gold should trade around $2,600, driven by Fed policy easing and persistent geopolitical tensions,” said Peter Fung, head of dealing at Wing Fung Precious Metals.
Israeli forces were close to fulfilling their mission in Gaza and their focus would turn to the country’s northern border with Lebanon as daily exchanges of fire with Hezbollah take place, defence minister Yoav Gallant said on Tuesday.
Among other metals, spot silver edged up 0.1% to $28.40/oz, platinum gained 0.6% to $943.10 and palladium was up by 0.9% to $973.78.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Gold rangebound as US CPI data takes the limelight
Investors await US inflation data for hints on the size of the Fed’s potential rate cut next week
Bengaluru — Gold prices steadied on Wednesday, as investors keenly awaited the US inflation data for hints on the size of the Federal Reserve’s potential interest rate cut next week.
Spot gold held its ground at $2,518.22/oz by 3.19am GMT. US gold futures rose 0.2% to $2,547.10.
“Gold is rangebound in a well-supported market ahead of a key US inflation report,” said City Index senior analyst Matt Simpson, adding that data is likely to show soft inflation and send gold to a record high.
The US consumer price index (CPI) data is due at 12.30pm GMT, while the producer price index (PPI) reading and initial jobless claims are due on Thursday.
The CPI report is expected to show inflation nearing the Fed’s 2% target, supporting chair Jerome Powell’s view that price growth is under-control, and play a pivotal role in determining the size of the rate cut next week.
The Fed will lower interest rates by 25 basis points (bps) at each of the three remaining policy meetings in 2024, according to a majority of economists in a Reuters poll.
Zero-yield bullion tends to be a preferred investment amid lower interest rates and geopolitical turmoil.
“I see good support for gold prices around $2,450-$2,460. By year-end, gold should trade around $2,600, driven by Fed policy easing and persistent geopolitical tensions,” said Peter Fung, head of dealing at Wing Fung Precious Metals.
Israeli forces were close to fulfilling their mission in Gaza and their focus would turn to the country’s northern border with Lebanon as daily exchanges of fire with Hezbollah take place, defence minister Yoav Gallant said on Tuesday.
Among other metals, spot silver edged up 0.1% to $28.40/oz, platinum gained 0.6% to $943.10 and palladium was up by 0.9% to $973.78.
Reuters
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