Gold closes in negative territory as Fed officials back further rate hikes despite lower-than-expected inflation data

Gold futures closed lower on Thursday (Aug. 11) and were under pressure after several Federal Reserve officials remained supportive of a rate hike despite signs of slowing inflation.

Investors focused their attention on the rising U.S. stock market instead of investing in safe assets such as gold and the dollar.

  • The gold contract fell $6.5, or 0.36%, to $1,807.2 per ounce, closing lower for the first time since Aug. 5
  • Silver was down 39.3 cents, or 1.89%, at $20.349 an ounce.
  • The platinum contract was up $13.3, or 1.41%, at $959.4 an ounce.
  • The palladium futures rose $42.50, or 1.9%, at $2,288.40 an ounce.

Gold futures were pressured by the prospect of further rate hikes from the Fed after the Fed said it would raise rates to curb inflation in the U.S., which remains high.

The Chicago Fed President said the latest Consumer Price Index (CPI) figures point to a slowdown in inflation in the U.S. in July. This marks the first positive reading since the Fed began tightening its monetary policy. However, inflation remains unacceptably high and the Fed must continue to raise interest rates.

The San Francisco Fed president said it is too early to declare victory in the fight against inflation and does not rule out the possibility that the Fed will raise interest rates by 0.75% for the third consecutive time at its September meeting.

CME Group’s latest FedWatch tool shows that 65.5% of investors expect the Fed to raise rates by 0.50% to between 2.75% and 3.00% at its September 20-21 meeting, and only 34.5% expect the Fed to raise rates by 0.75%.

Economic data released Thursday showed that the producer price index fell 0.5% in July from the previous month, after rising 1.0% in June.

According to the Bureau of Labor Statistics, initial jobless claims increased for the second week in a row, rising 14,000 to 262,000 last week.

The Spot Market is Open

Friday, August 12, 2022

Metals
Updated at
USD
Bid/Ask
Ounce
Change

Low/High
Gold
10.15
1,789.80
1,790.80
-0.20
-0.01%
1,786.30
1,791.20
Silver
10.15
20.32
20.44
+0.06
+0.30%
20.22
20.44
Platinum
10.15
954.00
964.00
-2.00
-0.21%
951.00
968.00
Palladium
09.40
2,190.00
2,340.00
-20.00
-0.90%
2,189.00
2,362.00
Rhodium
05.00
13,600.00
15,600.00
0.00
0.00%
13,600.00
15,600.00

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