Gold Prices Hold Steady Amid Softer Inflation Data, Fed Rate Hike Bets Reduced
Gold prices remained relatively stable on Thursday after a 6% decline in September, as softer US inflation data reduced expectations for another Federal Reserve rate hike.
The U.S. personal consumption expenditures price index excluding food and energy rose 0.2% in August, below expectations, which led to traders sharply reducing their bets for an interest rate increase at the Fed's October meeting.
However, elevated bond yields and the remaining risk of tighter monetary policy still leave bullion vulnerable to renewed selling, according to market analysts.
Gold entered October with some relief from the softer PCE reading, but long-term yields continuing to limit its upside. The markets will now turn to Friday's US jobs report for further clues on the Fed's interest-rate path and the outlook for gold.