Gold Holds Near Record High Ahead Of U.S. Inflation Data Release
The core personal consumption expenditures index is expected to show inflation probably remained uncomfortably high in February.
(Bloomberg) -- Gold held Monday’s gain as investors remained cautious ahead of key US inflation data, which may provide traders with a firmer view on when the Federal Reserve will start cutting interest rates.
The core personal consumption expenditures index, to drop on Good Friday, is expected to show inflation probably remained uncomfortably high in February. That could hinder plans by US policymakers to implement three interest rate cuts this year. Lower borrowing costs typically benefit the precious metal, which doesn’t yield interest.
Swaps markets trimmed wagers for a rate reduction in June to 65% from 69% late last week, after Fed Bank of Atlanta President Raphael Bostic on Monday reiterated his expectation for just one cut this year. Still, gold remains near an all-time high amid building momentum surrounding the central bank’s long-awaited pivot to monetary easing.
- Meanwhile, bullion saw some support from a slightly weaker US dollar, which snapped a two-day rally after the People’s Bank of China on Monday set a stronger-than-expected reference rate for the yuan
- Spot gold was steady at $2,172.97 an ounce as of 8:15 a.m. in Singapore, after gaining 0.5% on Monday. The Bloomberg Dollar Spot Index was flat. Silver and platinum were little changed, while palladium edged up
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