Gold Prices Edge Up on Easing Rate Pressure
Gold investors breathed a sigh of relief after softer US inflation readings eased fears that the Federal Reserve will tighten policy further. The spot price settled at $4,175.91 an ounce on Thursday, up 0.5% from the previous day, as money markets scaled back bets on another rate hike.
The most actively traded December gold contract climbed $30.30 to $4,217.00 an ounce, with participants interpreting the US price data as a sign that the peak in rate pressure may be near. However, elevated US Treasury yields continued to sustain selling pressure and blocked any more forceful breakout, while a resilient dollar added a second layer of headwinds.
Despite this, physically backed gold ETFs logged their tenth consecutive week of net inflows, with data released Monday showing last week's subscriptions at $1.72 billion against redemptions of $1.59 billion. This buying spree reflects a persistent institutional appetite for hedging monetary-policy and geopolitical risk.
Major research houses are rethinking their long-range forecasts in response to the stubbornly restrictive backdrop. The Wells Fargo Investment Institute, for example, cut its end-2027 target to a range of $5,200 to $5,400 an ounce, down from the $5,400 to $5,600 it had previously projected.