Gold prices edged lower on Thursday, pressured by a stronger U.S. dollar and rising Treasury yields, as investors awaited the release of the Personal Consumption Expenditure (PCE) index, a key inflation measure closely watched by the Federal Reserve. By 06:45 GMT, spot gold was down 0.6%, trading at $2,897.91 an ounce, while U.S. gold futures declined by 0.7%, to $2,909.30.
The dollar index rose by 0.2%, moving further away from recent 11-week lows, following U.S. President Donald Trump’s ambiguous statements about tariffs on Europe and delays in levies planned for Canada and Mexico. Meanwhile, the benchmark 10-year U.S. Treasury yields rebounded, reducing the allure of non-yielding gold.
Ilya Spivak, head of global macro at Tastylive, noted that “a slight uptick in the dollar and U.S. Treasury yields is putting pressure on gold this session,” though he emphasized that the overall upward trend for gold remains intact.
Investors are also looking ahead to speeches from several Federal Reserve officials later in the day, which could provide further clues about the central bank’s expected policy easing this year. Markets are particularly focused on Friday’s release of the PCE index, with a consensus forecast of a 0.3% monthly increase, consistent with December’s figure.
Spivak added, “Markets are currently sensitive to growth concerns following disappointing U.S. PMI data last week, and any stronger-than-expected PCE numbers that suggest the Fed might not cut rates soon could weigh on gold.”
While gold is traditionally seen as a hedge against political uncertainty and inflation, higher interest rates tend to reduce its attractiveness. Meanwhile, other precious metals also saw slight declines. Spot silver fell 0.2% to $31.77 an ounce, platinum dropped 0.1% to $964.70, and palladium remained unchanged at $926.47.
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