Gold rebounds on weaker dollar, yield drop; October Fed hike bets subdued
GLD•Gold rose more than 1% as the dollar weakened and Treasury yields fell, despite hotter-than-expected US producer-price data. Traders priced in about a 29% chance of a Fed rate hike later this month.
1. Gold prices rise
Spot gold gained 1.2% to $4,153.42 per ounce, while US gold futures settled 1.5% higher at $4,170.10. The dollar slipped 0.5%, and the benchmark 10-year Treasury yield reached a three-week low.
2. Rate expectations subdued
US producer prices rose by the most in 4-1/2 years in September, following a consumer-price report showing accelerated inflation. Remarks from San Francisco Fed President Mary Daly and Fed Vice Chair for Supervision Michelle Bowman tempered expectations for an immediate rate hike; traders priced in about a 29% chance of a hike later this month. Investors were watching for Fed Chair Kevin Warsh's comments at the IMF annual meeting.
3. Other metals advance
Spot silver rose 2.5% to $57.05 per ounce, platinum gained 1% to $1,622.40, and palladium climbed 3.4% to $1,131.25.
