Gold prices scaled a two-week peak on Wednesday, supported by escalating geopolitical tensions and expectations of another rate cut by the US Federal Reserve next week, and ahead of the closely watched US inflation report later in the day.
Spot gold was up 0.2 percent at $2,698.47 per ounce and hit its highest since Nov. 25.
US gold futures rose 0.6 percent to $2,734.70.
Investors’ focus is on the US Consumer Price Index (CPI), which is expected to have risen by 0.3 percent in November. The data could help set expectations for the Fed’s 2025 policy.
“An expected (CPI) number pretty much gives the Fed green light to cut (interest rates) next week and that might be the catalyst we need to see for gold,” said Kyle Rodda, financial market analyst at Capital.com.
The Fed is likely to cut rates by 25 basis points on Dec. 18, according to 90 percent of economists polled by Reuters, with most expecting a pause in late January amid concerns over inflationary risks.
On the geopolitical front, the Israeli military said it struck most of the strategic weapons stockpiles in Syria and hit two Syrian navy facilities, while the South Korean police raided the presidential office over martial law, Yonhap news agency reported.
