Gold posts weekly gains as US inflation data calms taper talk

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Gold posts weekly gains as US inflation data calms taper talk

The precious yellow metal gold futures’ prices ended in the black on Friday as a stagnation in US Consumer Spending in May coupled with a lower-than-anticipated inflation last month had bolstered US Fed Chair Powell alongside US Treasury Secretary Janet Yellen’s view that the latest round of inflation-surge would be momentary, eventually affecting the US Dollar’s safe-haven bid against a higher inflation which had been pressing gold futures’ prices over recent weeks.

Aside from that, spot gold prices had posted their first weekly percentage gain in four, as investors seemed to be cashing in again on risk-prone assets, restoring the bullion’s safe-haven appeal. In point of fact, US Commerce Department data had revealed earlier on Friday that the US Consumer Spending accountable for roughly 66 per cent of entire economic activities in the United States, had stalled last month amid a low-tide in motor vehicles’ sales, while Americans’ income fell 2.0 per cent last month, offering passable clues that a taper-talk from the US Fed might still be a far cry.

Bolstering a transitory inflation view further, the US Federal Reserve’s preferred inflation indicator, core PCE (Personal Consumer Expenditure) Price Index rose 0.5 per cent last month, missing an analysts’ estimate of 0.9 per cent.

Amid such evolving economic landscape in the United States with more than fifty per cent of entire US population having been fully vaccinated, Us Dollar shrugged off some of its earlier gains last week, which in effect had opened up an opportunistic window for the bullion to soar in the latest week.

Gold gains after economic data allays inflation fears

Citing statistics, in the day’s commodity market wind down, spot gold prices edged higher to $1,776.96 an ounce, while US gold futures’ prices remained almost dithered at $1,782.80.

On the week, spot gold gained 0.8 per cent, while US gold futures remained largely unchanged. Meanwhile, adding that the spot gold prices might have hit a resistance level at $1,770 an ounce, the bullion’s 100-day moving average, an analyst at Standard Chartered, Suki Cooper, said, “Gold has benefited from the lower-than-expected inflation print as concerns at the margin have eased over a sooner-than-expected timetable for tapering.