Spot gold was trading stable at $2,328.85 per ounce, with a cumulative advance of more than 4% in the quarter.
Reuters.- Gold prices steadied on Friday and were on track for a third straight quarterly gain after a key U.S. inflation report that was broadly in line with expectations, boosting hopes that the Federal Reserve will cut interest rates in September.
At 1335 GMT, spot gold was trading stable at $2,328.85 per ounce, with a cumulative advance of more than 4% in the quarter. US gold futures improved 0.1% to $2,339.60.
“We continue the trend of a slow decline in inflation. As a result, we have seen yields continue to fall and bonds continue to rise, which in some ways favors the gold market,” said David Meger of High Ridge Futures.
Gold was also helped by declining U.S. Treasury yields, making the non-interest-bearing bullion more attractive to investors.
Market bets that the Fed will cut rates in September and do so again in December rose after a government report showed that inflation as measured by the personal consumption expenditure (PCE) index did not increase from April to May.
According to CME’s FedWatch tool, traders now rate a September rate cut at 68%, up from 64% before the inflation data was released.
San Francisco Fed Chair Mary Daly said the latest inflation data is “good news that policy is working.”
In other base metals, spot silver rose 1.1% to $29.38, platinum gained 2.5% to $1,012.03 and palladium climbed 4.5% to $970.88. The former two were on track to close the quarter higher, while the latter was heading for its third straight quarterly decline.
