Gold Steady Amid PCE Relief, Tightening Expectations Cap Gains

(MENAFN- MENAFNEditorial) Gold was slightly higher on Thursday as softer US inflation reports lowered expectations of a Federal Reserve rate hike in October. The US PCE price index rose 0.3% in August, below the 0.4% forecast, while core PCE increased 0.2%, also coming in below expectations for a 0.3% gain. That led to a decrease in the odds of an interest rate hike in October to less than 40%, providing support to the metal.

However, US Treasury yields remain elevated, limiting gains, along with the strong dollar. A rise in oil prices kept inflation concerns present. At the same time, a December rate increase is still priced in, which could keep the metal under strain.

Looking ahead, traders keep a close eye on Friday’s nonfarm payrolls report and remarks from Fed policymakers ahead of the Federal Reserve’s October meeting. A softer reading or messaging could push yields down and support gold, while stronger data could pressure the yellow metal. Oil prices and Middle East tensions remain near-term risks.

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