Gold Price Edges Higher on Softer US PPI Data

The gold price continued its upward trend on Friday morning in Asia, reaching around $4,360. This increase is attributed to softer US PPI data, which has reduced bets for a September Fed rate hike.

According to the US Bureau of Labor Statistics, the headline PPI was unchanged month-over-month in July, whereas market expectations were 0.2% growth. The core PPI rose 0.2% MoM during the same period, also below forecasts.

The data has led to a significant reduction in expectations for a Fed rate hike next month, with money markets pricing in less than a 40% chance of a September increase. Lower interest rates reduce the opportunity cost of holding non-yielding bullion like gold.