BENGALURU- Gold prices held above the key $2,400 per ounce pivot on Friday and posted their third straight weekly gain, as investors grew confident that the US Federal Reserve was on track to lower interest rates soon.
Spot gold was steady at $2,417.36 per ounce. The bullion was up 1 percent for the week so far.
US gold futures settled mostly unchanged at$2,420.70.
Gold prices rallied to their highest since May 22 on Thursday after an unexpected decline in US consumer prices. The data strengthened the view that the disinflation trend has resumed and lifted hopes for rate cuts by the Fed.
“We’re seeing some profit-taking pressure, a routine corrective pullback after the solid gains. Today’s producer price index report was hotter than expected and that added to some selling pressure,” said Jim Wyckoff, senior market analyst at Kitco Metals.
“However, judging from the reaction of the stock market and the bond market, today’s PPI number does not really mitigate the cooler inflation report we saw on Thursday. So the odds are high for a rate cut this year, possibly as early as September.”
US producer prices increased moderately in June, further confirming that inflation had resumed its downward trend and strengthening the case for a September interest rate cut.
