GOLD nudged higher for a fifth straight session on Thursday (Dec 12) to hover near a more than two-week peak, supported by increased expectations of an interest rate cut from the Federal Reserve next week after US inflation data came in line with forecast.
Spot gold was up about 0.1 per cent at US$2,719.79 per ounce, as at 0035 GMT. US gold futures steadied at US$2,755.40.
US consumer prices increased by the most in seven months in November, but that is unlikely to discourage the Fed from cutting interest rates for a third time next week against the backdrop of a cooling labour market.
Traders predict a 98.6 per cent chance of a 25-basis-point cut at the Fed’s Dec 17 to 18 meeting, CME’s FedWatch Tool showed.
Focus now shifts to US Producer Price Index data, due for release at 1330 GMT, for insights into Fed’s monetary policy for 2025.
Meanwhile, the European Central Bank is all but certain to cut interest rates again on Thursday and signal further easing in 2025 as inflation in the eurozone is nearly back at its target and the economy is faltering.
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The bullion is seen as a safe investment during economic and geopolitical turmoil and thrives in a low-interest-rate environment.
Elsewhere, the United Nations General Assembly overwhelmingly voted on Wednesday to demand an immediate, unconditional, and permanent ceasefire between Israel and Palestinian militants Hamas in the Gaza Strip and the immediate release of all hostages.
Citi said in a note that gold and silver markets are set to resume a gradual uptrend over three to 12 months, reaching US$3,000/oz and US$36/oz respectively.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.30 per cent to 873.38 tonnes on Wednesday from 870.79 tonnes on Tuesday.
Spot silver added 0.1 per cent to US$31.94 per ounce, platinum gained 0.4 per cent to US$943.10 and palladium rose 0.5 per cent to US$986.25. REUTERS
