Gold Bounces Amid U.S. Inflation Data, Rate Hike Expectations
Gold prices rebounded on Friday after falling nearly 2% in the previous session, despite firm U.S. inflation data that bolstered wagers on a Federal Reserve interest rate hike next week.
The spot gold price rose by 1.7% to $4,390.39 an ounce at 09:51 ET (13:51 GMT), while the gold price in dollars advanced by 0.6% to $4,432.30 an ounce.
Despite this increase, gold remains on track for a third consecutive weekly decline as traders grapple with the prospect of tighter Fed monetary policy.
The U.S. consumer price growth accelerated in August as anticipated, while an underlying gauge came in slightly hotter than expected.
Policymakers at the Fed have stressed that they will be focusing on corralling inflation when they meet next week, driving speculation that the Fed may opt to raise rates following the two-day gathering on Wednesday.
Fed Chair Kevin Warsh has even suggested that the central bank will “have work to do” should price growth not display signs that it is sustainably easing down to 2%, the Fed’s inflation target.