GOLD PRICES TODAY: YELLOW METAL TRADES HIGHER ON LOW YIELDS AFTER US FED'S PREFERRED INFLATION GAUGE LIFTS RATE CUT BETS

Gold prices rose one per cent on Friday, July 26, supported by lower US Treasury yields amid growing optimism for an interest rate cut by the US Federal Reserve in September after official data showed US prices rose modestly in June.

Spot gold was up about one per cent to $2,386.99 per ounce, after hitting its lowest since July 9 on Thursday. US gold futures for August delivery rose 1.4 per cent to $2,386. Spot silver fell 0.6 per cent to $27.80 per ounce, tracking its worse week since early December. Platinum was up 0.1 per cent at $931.83, while palladium lost 1.1 per cent to $897. Silver, platinum and palladium were headed for their third straight weekly fall.

 

"Today's mixed-to-weaker U.S. data suggests inflationary pressures and economic activity are waning, paving the way for the Fed to cut rates twice this year," said Fawad Razaqzada, market analyst at Forex.com.

Fed policymakers on Friday got fresh evidence of progress on their battle against inflation, fuelling expectations they will use their meeting next week to signal interest-rate cuts starting in September.

Lower interest rates reduce the opportunity cost of holding non-yielding bullion.

The personal consumption expenditures (PCE) price index nudged up 0.1% last month after being unchanged in May, the U.S. Commerce Department's Bureau of Economic Analysis said.

Following the data, benchmark 10-year note yields fell to a one-week low. 

Meanwhile, physical demand in India, the second-largest consumer, received a boost as the country slashed import duties on gold and silver earlier this week. Gold premiums in India jumped to their highest level in a decade this week as well. 

"Any uptick that we see from India or China tends to have an outside effect on overall demand ... I think the move to reduce the duty (in India) can only have a positive effect on demand," said Everett Millman, chief market analyst with Gainesville Coins.

Spot silver fell 0.6% to $27.80 per ounce on Friday, tracking its worse week since early December.

Platinum was up 0.1% at $931.83, while palladium lost 1.1% to $897.

Silver, platinum and palladium were headed for their third straight weekly fall.

2024-07-26T17:58:46Z dg43tfdfdgfd