Gold prices stabilize ahead of U.S inflation report

Gold prices were stable Thursday ahead of the U.S. July inflation report as the yellow metal recovered slightly from some of its recent losses which have been driven by higher global bond yields and a stronger U.S. dollar.

Price action

Gold futures for December delivery
SI00,
+0.33%

GCZ23,
+0.24%
gained $3.50, or 0.2%, to $1,954 per ounce on Comex.
Silver futures for September delivery
SI00,
+0.33%

SIU23,
+0.33%
gained 9 cents, or 0.4%, to $22.83 per ounce.
Palladium futures for September
PA00,
+3.33%

PAU23,
+3.33%
increased by $29, or 2.4%, to $1,260 per ounce, while platinum futures for October
PL00,
+0.63%

PLV23,
+0.63%
rose by $8.30, or 0.9%, to $901 per ounce.
Copper futures for September delivery
HG00,
+0.53%

HGU23,
+0.53%
gained 4 cents, or 1%, to $3.82 per pound.

Market drivers

Thursday’s U.S. CPI report could be a significant moment for gold, which has seen its year-to-date gains ease as global bond yields have risen and the U.S. dollar has climbed over the past couple of weeks.

Another softer-than-expected inflation reading would mark two straight months of price pressures ebbing more quickly than economists had realized and could help to boost gold prices, analysts said.

“There’s still a long way to go but the US has made significant progress [on inflation], even at the core level, and more is expected over the rest of the year. If it can do so at a more accelerated rate than currently envisaged then gold could prosper,” said Craig Erlam, senior market analyst at OANDA, in emailed commentary.

In June the pace of inflation ebbed to its slowest since August 2021, helping to boost U.S. stocks and gold as investors bet that the Federal Reserve would hold off on another interest-rate hike in September.

For July, economists expect the headline inflation rate to rise 0.2%, which is in line with the pace from the prior month and for the year-on-year rate to rise 3.3%, up from 3.0% in June.

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