Gold eyes second weekly gain on gradually easing US inflation

News

Gold prices firmed near month-high levels on Friday and were set for a second weekly rise after data showed that U.S. inflation was gradually easing, while traders turned their focus to remarks from a slew of Federal Reserve officials.

FUNDAMENTALS

* Spot gold was steady at $2,043.98 per ounce, as of 0150 GMT, after hitting $2050.59 on Thursday – its highest level since Feb. 2. U.S. gold futures edged 0.1% lower to $2,052.40.
* Data on Thursday showed the U.S. personal consumption expenditures (PCE) price index rose by 0.3% in January, while the core PCE price index gained 0.4%. In the 12 months through January, inflation rose 2.4% – the smallest in nearly three years.

* U.S. central bankers are looking through recent data showing price pressures rebounded last month, and are focusing instead on overall progress on inflation that they say will likely set the table for interest-rate cuts later this year.

* At least six more Fed officials are due to speak on Friday.

* Traders are betting on about three quarter-point (25 bps) interest rate cuts for 2024 in the U.S., with a 65% chance of the first one coming in June, according to LSEG’s interest rate probability app IRPR. * Lower interest rates boost the appeal of non-yielding bullion. * The world’s largest gold-backed exchange-traded fund, SPDR Gold Trust’s holdings fell 3.3% in February and 6.4% so far this year.

* Platinum group metals producer Impala Platinum could shut some of its loss-making South African mining operations if metal prices deteriorate further and restructuring efforts fail to improve margins, CEO Nico Muller said.

* Spot platinum climbed 0.5% to $880.45 per ounce, and palladium rose 0.2% to $943.37, while silver fell 0.1% to $22.64.

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