Gold prices stable with eyes on inflation report, tariff threats from Trump

WASHINGTON: Gold traded in a relatively narrow price range on Thursday as investors focused on US President Donald Trump’s tariff plans and a key inflation report for monetary policy cues.

Spot gold was up 0.1 per cent at $2,761.44 per ounce, as of 0402 GMT.

US gold futures climbed 0.1 per cent to $2,773.30.

The premium over spot rates was at nearly $12. Investors are now awaiting the December personal consumption expenditures (PCE) price index report, due on Friday, to assess the inflation trajectory.

The Federal Reserve held interest rates steady on Wednesday and Chair Jerome Powell said there would be no rush to cut them again until inflation and jobs data made it appropriate.

Bullion is considered a hedge against inflation, but higher interest rates dampen the non-yielding bullion’s appeal.

“Investment demand has to increase to keep gold prices moving towards the $2,900 or $3,000 level,” said Soni Kumari, a commodity strategist at ANZ. It will all depend on policy changes, inflation, and geopolitical risks and how all that plays out, said Kumari.

Earlier this week, the White House said Trump still plans to hit Mexico and Canada with steep tariffs on Saturday and he is “very much” considering some on China.

London bullion market players are racing to borrow gold from central banks, following a surge in gold deliveries to the US amid tariff fears.

Elsewhere, the European Central Bank is all but certain to cut interest rates later in the day and is likely to keep open the door to further policy easing.

Spot silver was up 0.2 per cent at $30.88 per ounce, platinum added 1.2 per cent to 957.67, and palladium gained 0.9 per cent to $970.58.

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