Gold steadies as cooler US inflation data counters higher Treasury yields
GLD•Spot gold rose 0.1% to $4,162.38 an ounce after US inflation came in below expectations, reducing the market-implied chance of an October Fed rate hike to 37% from 45%. Higher Treasury yields and a stronger dollar limited gains.
1. Gold moves slightly higher
Spot gold gained 0.1% to $4,162.38 per ounce, while US gold futures for December delivery rose 0.1% to $4,192.10. Gold fell more than 6% in September.
2. Inflation and rate expectations
US inflation rose less than expected in August, and price pressures were revised lower for the prior month. The data lowered expectations of an October rate hike; traders priced in a 37% chance, down from 45% before the release, while the implied probability of a December increase remained 89%.
3. Yields and upcoming data
The 10-year Treasury yield reached its highest level in more than two decades, and a stronger dollar also limited gold’s gains. Investors were watching the September US nonfarm payrolls report due Friday and remarks from Fed policymakers.
