Gold prices have strengthened as a result of a new set of weak U.S. economic data, which has reinforced expectations that the Federal Reserve will halt its rate hike trajectory for the rest of the year. Despite this uptick, gold remains on track for a monthly loss, influenced by rising Treasury yields and a stronger dollar.
Here are the key points:
Spot gold has increased by 0.2% to $1,946.17 per ounce as of 0114 GMT, trading near its one-month high achieved on Wednesday. Meanwhile, U.S. gold futures have stabilized at $1,973.10.
Gold is facing the prospect of a nearly 1% decline over the month, as the U.S. dollar is set to experience its first monthly rise in three months, and U.S. Treasury yields are continuing their fourth consecutive monthly climb, reaching levels not seen since 2007.
The U.S. economy’s second-quarter growth rate was slightly lower than initially projected. Investors are now awaiting the release of PCE inflation data later in the day, as well as the non-farm payrolls report scheduled for Friday.
According to the former president of the Boston Fed, if the labor market and economic growth continue to slow at the current gradual pace, the Federal Reserve could conclude its cycle of interest rate hikes.
In Japan, factory output for July fell more than anticipated when compared to the previous month.
The SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, noted a slight increase of 0.1% in its holdings, reaching 890.10 tons on Wednesday.
Elsewhere, spot silver remained stable at $24.66 per ounce, having achieved a more-than-one-month high on Wednesday.
Platinum has gained 0.3% to $977.02, potentially marking its second consecutive monthly gain, while palladium has risen by 0.5% to $1,228.42. Nevertheless, palladium is poised for a monthly decline of around 4%.
The upcoming events and data include the HICP Flash YY for August in the EU, the Unemployment Rate for July in the EU, Consumption Adjusted MM for July in the U.S., Core PCE Price Index MM and YY for July in the U.S., as well as the Initial Jobless Claims for the week in the U.S.
