Gold closed $1.4 higher after lower-than-expected inflation numbers and the weak dollar supported markets

Gold futures closed higher on Wednesday (Aug. 10) after the U.S. released lower-than-expected inflation figures. This helped to reduce investors’ concerns about a high interest rate hike by the Federal Reserve (Fed).

  • The gold contract was up $1.4, or 0.08%, at $1,813.7 per ounce. This is the highest closing level since June 29.
  • Silver futures were up 26 cents, or 1.27%, at $20.742 an ounce.
  • The platinum was up $13.1, or 1.4%, at $946.1 per ounce.
  • The palladium futures rose $27.10, or 1.2%, at $2,245.90 an ounce.

According to the U.S. Department of Labor, the consumer price index (CPI) rose 8.5% year-on-year in July. This was below analysts’ forecast of 8.7%, after reaching a 40-year high of 9.1% in June.

The lower-than-expected CPI has prompted investors to lower their forecasts for the Fed’s interest rate outlook. CME Group’s FedWatch tool indicates that investors 61.5% think the Fed will raise rates by 0.50% to 2.75-3.00%. Meeting on September 20-21 and weighted only 38.5% that the Fed will raise rates by 0.75%.

Previously, 68.5% expected the Fed to raise rates by 0.75% to 3.00-3.25% at its September 20-21 meeting, and only 31.5% expected the Fed to raise rates by 0.50%.

In addition, gold contracts were also supported by the weakening of the dollar and the decline in U.S. Treasuries.

The dollar index against the six major currencies in a basket of currencies fell 1.11% to 105.1960, and the yield on the 10-year U.S. Treasury bond fell to 2.723%.

A weaker dollar will make gold contracts cheaper for holders of other currencies.

The Spot Market is Open

Thursday, August 11, 2022

Metals
Updated at
USD
Bid/Ask
Ounce
Change

Low/High
Gold
11.40
1,784.80
1,785.80
-7.60
-0.42%
1,784.10
1,794.00
Silver
11.40
20.45
20.55
-0.14
-0.68%
20.43
20.70
Platinum
11.40
943.00
953.00
-1.00
-0.11%
940.00
956.00
Palladium
11.40
2,160.00
2,310.00
-16.00
-0.74%
2,158.00
2,334.00
Rhodium
05.00
13,600.00
15,600.00
0.00
0.00%
13,600.00
15,600.00

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