Gold prices moved higher Friday morning on the heels of a report showing that the Fed’s preferred inflation gauge came in slightly higher than expected last month.
The yellow metal was on pace to trim Thursday’s nearly 1.5% decline and recover some of the losses incurred in the last six of seven trading sessions.
Gold was up $24.96 and hovering around the $2,390 per ounce level. Silver, meanwhile, was more mixed, shifting multiple times between negative and positive territory. The gray metal – which struggled this week on an unclear demand outlook in China – was down $0.09 at $27.75 per ounce.
Bullion traders also had a little more time to digest Thursday’s surprise report showing a dramatic increase in U.S. economic activity for the second quarter, lifted by robust consumer spending and private inventory investment. The data caused gold to plummet after its initial release.
Data released on Friday by the U.S. Bureau of Economic Analysis showed that personal consumption expenditures (PCE) edged 0.1% higher last month – matching Wall Street estimates – while the 12-month headline inflation rate dipped to 2.5%
But the wrinkle came in the core PCE index data – the Fed’s preferred method of measuring inflation – which strips out food and energy because of their often-volatile price swings.
The core PCE index rose 0.2% last month, higher than projections of a 0.1% increase. Additionally, the 12-month core inflation rate remained stuck at 2.6% for a second straight month, above forecasts of 2.5%.
The mixed data adds yet another twist heading into next week’s Federal Open Market Committee meeting when investors are hoping policymakers signal their willingness to begin cutting interest rates in September.
Gold Price Chart
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