Gold rally pauses as focus turns to US inflation data
Metal dips after touching record high in the previous session, as Fed chair’s hawkish comment cements views of slower rate cuts this year
12 February 2025 - 07:31
byAnushree Mukherjee
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SA’s major gold miners have recorded double-digit share price gains since the start of the year. Picture: ANGELIKA WARMUTH/REUTERS
Bengaluru — Gold prices slipped on Wednesday after rising to a record high in the previous session, as Federal Reserve chair Jerome Powell’s hawkish comment cemented views of slower rate cuts this year, while investors awaited a key US inflation report.
Spot gold fell 0.1% to $2,895.38/oz by 2.32am GMT after climbing to a record high of $2,942.70 on Tuesday. US gold futures eased 0.4% to $2,922.40. Powell said on Tuesday the economy was in a good place and the Fed was not rushing to cut interest rates further, but was prepared to do it if inflation dropped or the job market weakened.
Bullion is considered a hedge against inflation, but higher interest rates dampen the non-yielding asset's appeal.
“There is an element of profit-taking on gold following its all-time highs and ahead of the next batch of US inflation data, which shapes as a possible risk event for the precious metal if core CPI [consumer price index] happens to produce an upside beat,” said Tim Waterer, chief market analyst at KCM Trade.
The US CPI report is due at 1.30pm GMT later in the day and the producer price index (PPI) data is scheduled to be out on Thursday. Powell is also due to testify before Congress later in the day.
Mexico, Canada and the EU on Tuesday condemned US President Donald Trump’s decision to impose tariffs on all steel and aluminium imports next month, which has fanned fears of a major global trade war as investors brace for more trade duty announcements.
“The bullish trend [in gold] remains intact given the tariff picture uncertainty and the resulting safe-haven flows, which could keep underpinning the precious metal,” Waterer said.
Spot silver was steady at $31.83/oz, platinum was unchanged at $983.15 and palladium firmed 0.3% to $978.75.
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 rally pauses as focus turns to US inflation data
Metal dips after touching record high in the previous session, as Fed chair’s hawkish comment cements views of slower rate cuts this year
Bengaluru — Gold prices slipped on Wednesday after rising to a record high in the previous session, as Federal Reserve chair Jerome Powell’s hawkish comment cemented views of slower rate cuts this year, while investors awaited a key US inflation report.
Spot gold fell 0.1% to $2,895.38/oz by 2.32am GMT after climbing to a record high of $2,942.70 on Tuesday. US gold futures eased 0.4% to $2,922.40. Powell said on Tuesday the economy was in a good place and the Fed was not rushing to cut interest rates further, but was prepared to do it if inflation dropped or the job market weakened.
Bullion is considered a hedge against inflation, but higher interest rates dampen the non-yielding asset's appeal.
“There is an element of profit-taking on gold following its all-time highs and ahead of the next batch of US inflation data, which shapes as a possible risk event for the precious metal if core CPI [consumer price index] happens to produce an upside beat,” said Tim Waterer, chief market analyst at KCM Trade.
The US CPI report is due at 1.30pm GMT later in the day and the producer price index (PPI) data is scheduled to be out on Thursday. Powell is also due to testify before Congress later in the day.
Mexico, Canada and the EU on Tuesday condemned US President Donald Trump’s decision to impose tariffs on all steel and aluminium imports next month, which has fanned fears of a major global trade war as investors brace for more trade duty announcements.
“The bullish trend [in gold] remains intact given the tariff picture uncertainty and the resulting safe-haven flows, which could keep underpinning the precious metal,” Waterer said.
Spot silver was steady at $31.83/oz, platinum was unchanged at $983.15 and palladium firmed 0.3% to $978.75.
Reuters
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