Gold prices remained steady on Friday, poised for a third consecutive week of gains as U.S. economic data bolstered expectations that the Federal Reserve may ease interest rates further in 2025.
Key Highlights:
- Spot Gold: Flat at $2,715.21 per ounce as of 0047 GMT, near Thursday’s one-month high; up approximately 1% for the week.
- U.S. Gold Futures: Slight dip of 0.1% to $2,747.50.
Drivers of Market Sentiment:
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Federal Reserve Outlook:
- Fed Governor Christopher Waller signaled that 3–4 rate cuts remain on the table for 2025, contingent on further economic data showing weakness.
- CPI data released earlier this week reinforced hopes for monetary easing, with the central bank expected to hold rates steady at 4.25%-4.50% during its Jan. 28-29 meeting.
- Richmond Fed President Thomas Barkin remarked that December inflation figures confirm a continued easing in price pressures.
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U.S. Economic Data:
- A slew of reports, including retail sales and initial jobless claims, weighed on Treasury yields and the U.S. dollar, providing additional support for gold.
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Market Dynamics:
- Gold’s role as an inflation hedge remains significant, though elevated interest rates can erode its appeal.
- Concerns persist over potential inflationary pressures stemming from incoming policy changes under the Donald Trump administration, including possible tariff implementations.
Broader Precious Metals Market:
- Silver: Gained 0.1% to $30.82 per ounce, up over 1% this week.
- Palladium: Eased 0.1% to $937.25, heading for a weekly loss.
- Platinum: Dropped 0.1% to $931.85, also set for weekly losses.
Investor Activity:
- Holdings in the SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, declined by 0.43% to 868.78 tonnes on Thursday from 872.52 tonnes on Wednesday.
Upcoming Economic Data to Watch:
- China: Urban investment, GDP, unemployment rate (Dec).
- UK: Retail sales metrics (Dec).
- EU: HICP final readings (Dec).
- U.S.: Housing starts and industrial production figures (Dec).
Gold continues to draw investor attention as evolving economic indicators and Federal Reserve policy remain in focus.