Gold prices firmed for a third consecutive session on Thursday, with investors awaiting U.S. inflation data due later in the day for more insights on the Federal Reserve’s interest rate path.
Chris Ratcliffe | Bloomberg | Getty Images
Gold prices climbed for a third straight session on Thursday, helped by a weaker U.S. dollar ahead of inflation data that will determine whether the Federal Reserve will lower interest rates this year.
Spot gold gained 0.5% to $2,383.63 per ounce. U.S. gold futures rose 0.4% to $2,389.00.
The dollar edged 0.2% lower, making the greenback-priced bullion more attractive for other currency holders.
“Gold continues to shine on rising Fed rate cut bets following dovish comments by Powell during his congressional testimony,” said FXTM senior research analyst Lukman Otunuga.
Fed Chair Jerome Powell, over his two days of commentary before the Senate and House committees that oversee the central bank, indicated the Fed was edging closer to a rate cut decision, while insisting that he was not yet ready to declare that inflation had been beaten.
The Consumer Price Index (CPI) report is due at 1230 GMT, where expectations are for core inflation to have risen 0.2% on a monthly basis in June. The Producer Price Index (PPI) reading is due on Friday.
“A softer-than-expected CPI could push gold above $2,400/oz, suggesting the bull run may resume. Given the overall trajectory on monetary policy and gold demand I think the bull run is not over yet,” said Zain Vawda, market analyst at MarketPulse by OANDA.
Markets are now pricing in a more than 71% chance of a rate cut from the Federal Reserve in September, compared to a near-even chance a month ago, according to the CME FedWatch tool.