GOLD prices edged up on Thursday, aided by a weaker dollar and hopes of a Federal Reserve interest rate cut, while focus turned to a key US inflation print.
Spot gold was up 0.5 per cent to US$2,513.77 per ounce, as of 0250 GMT. Bullion hit a record high of US$2,531.60 on Aug 20 and is up nearly 22 per cent this year so far.
US gold futures rose 0.4 per cent to US$2,546.80.
The dollar dipped 0.1 per cent, making gold more appealing for holders of other currency. Benchmark 10-year Treasury yields also ticked lower.
In the long-term, gold looks strong, but a short-term pullback is possible, especially if any data dampens rate cut expectations, said Kyle Rodda, a financial market analyst at Capital.com.
Bullion, a non-yielding asset, is more appealing in a low interest rate environment.
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Market participants are awaiting US initial jobless claims and GDP data due at 1230 GMT. The Personal Consumption Expenditures (PCE) data is due on Friday, which could offer further clues on the outlook for rates.
Traders have fully priced in a Fed easing for next month, with a 65.5 per cent chance of a 25-basis-point cut and about 34.5 per cent chance of a bigger 50-bp reduction, according to the CME FedWatch tool.
Atlanta Fed President Raphael Bostic on Wednesday said that with inflation down and unemployment up, it might be “time to move” on rate cuts, though he remains cautious.
“Visible short positions remains near decade-lows. Narratives in gold markets are unanimously bullish. We see significant risks to the near-term outlook tied to positioning, despite the strong fundamental backdrop,” said Daniel Ghali, commodity strategist at TD Securities in a note.
Among other metals, spot silver rose 0.91 per cent to US$29.38 per ounce, platinum climbed 0.5 per cent to US$934.52 and palladium edged 0.3 per cent higher to US$948.95. REUTERS
