Monday saw a little increase in gold prices as Treasury rates declined. Investors were waiting for new information on the possible timing of the central bank’s interest rate cut as they closely monitored important U.S. inflation statistics and remarks made by Federal Reserve officials throughout the week.
As of 0541 GMT, spot gold was up 0.2% at $2,324.25 an ounce, following a more than 1% decline on Friday. Futures for US gold increased by 0.2% to $2,336.60.
Standardization The yield on the 10-year U.S. Treasury decreased, which increased investors’ attraction to non-yielding bullion. [US/]
“The strong U.S. dollar caused a rather large sell-off on Friday night. Even if the markets are trending toward two rate cuts this year, it has somewhat hurt gold, according to Capital.com financial market expert Kyle Rodda.
A surge in employment accompanied by a slow but steady increase in U.S. corporate activity led to a 26-month high in June and the strongest dollar in almost eight weeks. Bullion becomes pricey for holders of other currencies when the dollar appreciates. [USD/]
The Fed’s favored gauge of inflation, the U.S. core personal consumption expenditures price index data, is expected on Friday. Traders will be watching for this report for additional clues regarding the timing and magnitude of rate decreases.
If PCE data keeps trending lower, it may indicate that the Fed is in a position to cut interest rates twice this year. And it will be a pretty good thing for gold if we receive that, Rodda continued.
The opportunity cost of owning non-yielding bullion is decreased by lower rates.
This week, at least five Federal Reserve officials will be speaking, including Fed Governors Lisa Cook and Michelle Bowman as well as President Mary Daly of the San Francisco Fed.
Palladium increased by 0.8% to $956.59, platinum remained stable at $991.95, and spot silver increased by 0.3% to $29.61 per ounce.
