Gold dips a bit on stronger dollar, but still in tight range early Friday ahead of comments by Federal Reserve Chairman Jerome Powell in Jackson Hole, Wyoming. The bullion looks headed for a weekly gain,
The yellow metal regained a bit of ground after the release of the Fed’s preferred inflation measurement which fell 0.1% month over month. The personal consumption expenditures price index showed a year-over-year rise of 6.3% in July, down from 6.8% in June. The core PCE index rose 4.6% year over year and a gain of 0.1% month over month in July. Economists surveyed by Dow Jones were expecting 4.8% for the core year-over-year reading and 0.2% for the month-over-month change.
Investors are hoping to get indications from Powell on Fed sentiment for future monetary policy decisions. Powell’s remarks are a highlight of the annual meeting of central bankers. European Central Bank Executive Board member is set to speak Saturday. Bank of England Governor Andrew Bailey will also attend. Of special interest will be any signals on the pace of expected interest rate hikes, efforts to combat inflation and any concern about a possible recession.
Front-month gold futures rose 0.6% Thursday to settle at $1,771.40 an ounce on Comex, though the December contract increased 0.5% in the first four days of the week. Bullion dropped 1.4% in July after falling 2.2% in June and 3.3% in May, its worst month since September. The metal retreated 3.5% in 2021. Currently, the December contract is down $6.70 (-0.38%) an ounce to 1764.70 and the DG spot price is $1755.00.
Investors are now betting there’s a 38.9% chance of a 50-basis-point rate hike in September, with 61.5% projecting a 75-basis-point increase, according the CME FedWatch Tool. The Fed raised rates by 75 basis points each in June and July.
In economic news Thursday, U.S. second-quarter GDP contracted by 0.6%, better than the previous estimate. But gross domestic income increased 1.4%, with spending revised up. Meanwhile, weekly initial jobless claims fell to a one-month low of 243,000 last week.
Front-month silver futures gained 1% Thursday to settle at $19.16 an ounce on Comex, though the December contract dropped less than 0.1% in the first four days of the week. Silver slipped 0.8% in July after declining 6.2% in June and falling 6.1% in May. It retreated 12% in 2021. Silver prices are tied to industrial demand. The September contract is currently up $0.180 (+0.94) an ounce to $19.300 and the DG spot price is $19.38.
Spot palladium rose by 5.9% Thursday to $2,169.50 an ounce and is up 1% so far this week. Palladium rose 9.9% in July after losing 2.9% in June and 14% in May, the biggest monthly decline since September. It retreated 22% in 2021. Currently, the DG spot price is up $21.20 an ounce to $2191.00.
Spot platinum advanced 1% Thursday to $890.30 an ounce, but is down 1.3% so far this week. Platinum retreated 0.3% in July after losing 7.2% in June. It dropped 9.4% last year. The DG spot price is down $3.70 an ounce to $888.20.
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