Gold Prices Rise as Softer Inflation Data Bolsters Demand

Gold prices rose on Thursday as a weaker U.S. dollar and softer inflation data from the Federal Reserve bolstered demand for the metal.

The price of gold, as measured in dollars, reached around $4,097 per ounce, while the pound-denominated price climbed to about 5,940 pounds, up nearly 55 pounds from the previous day's close.

The U.S. Bureau of Economic Analysis reported that the Personal Consumption Expenditures Price Index rose 3.7% year-over-year in June but slowed month-over-month to 0.1%, below market expectations of 0.2%. The core PCE Price Index, which excludes food and energy prices, also showed a slight slowdown.

Analysts noted that the data reduces the need for further monetary tightening by the Federal Reserve, supporting gold's gains. However, inflation remains above the central bank's target, limiting the impact of the data on interest rates and bond yields.