Gold firms on Fed rate cut hopes; investors await more US data
Gold prices edged higher on Monday as signs of cooling U.S. inflation lifted hopes for interest rate cuts from the Federal Reserve this year, while traders awaited a slew of U.S. economic data due this week.
edged higher on Monday as signs of cooling U.S. lifted hopes for from the this year, while traders awaited a slew of U.S. due this week.Spot gold was up 0.2% at $2,331.84 per ounce as of 09:49 a.m. ET (1349 GMT), after posting a 2% gain last month. Prices hit an all-time high of $2,449.89 on May 20.
"We've had a bit of a pullback, we'd prefer to call it a consolidation. But again, the underpinning positive bias really comes from strong expectation that we are moving towards a cuts at some point later this year," said David Meger, director of alternative investments and trading at .
Data on Friday showed that the U.S. had stabilised in April, suggesting the U.S. central 's interest rate cut plans later this year remained intact.
Traders are currently pricing in about a 56% chance of a cut in September, according to tool. Lower interest rates decrease the of holding nonyielding bullion.
Investors examine the 's (ISM) nationwide PMI reading, expected at 1400 GMT, Wednesday's ADP employment report, and due on Friday.
"We still expect a slowdown (in U.S. economic data) will allow the Fed to cut interest rates later this year and this should lift gold prices," analyst Giovanni Staunovo said.
Meanwhile, The is seen almost certain to trim rates by a quarter point to 3.75% on Thursday, which could make it the first major central bank to cut rates this cycle.
Elsewhere, spot silver eased 0.2% to $30.31 per ounce, platinum slipped 0.9% at $1,028.85 and palladium gained 1.8% to $929.54.
Poll Trackers
