Gold hits 6-week high after U.S. data dampens rate hike expectations
Gold prices rose to a six-week high on Friday after weaker than expected U.S. inflation dampened expectations that the U.S. Federal Reserve will aggressively raise interest rates.
Data on U.S. second quarter gross domestic product (GDP) and labour costs also pushed the dollar lower, making bullion more expensive for holders of other currencies.
“It showed a big fall in annual inflation rates across the board … so there is no urgency for the Fed to raise interest rates,” said Commerzbank analyst Carsten Fritsch.
…”The US economy remains in growth, but there’s very little sign of inflationary risk in today’s GDP data,” Ranko Berich, Head of Market Analysis at Monex Europe, said in a note.
“It’s difficult to get optimistic about rates or USD off the back of today’s release,” he said.