Gold prices holding more than 1% gains following mixed U.S. CPI Data
(Kitco News) - The gold market is holding on to solid gains but seeing little reaction to mixed inflation data.
Thursday the U.S. Labor Department said its U.S. Consumer Price Index rose 0.1% in August, after a 0.3% rise in July. The data in line with consensus forecasts. For the year, headline inflation rose 1.7%, down from July’s rise of 1.8%.
According to the report, weak energy prices helped to push down inflation pressures in august. The energy index fell 1.9 percent in August as the gasoline index declined 3.5 percent, the report said.
Meanwhile, after stripping out volatile food and energy prices, core inflation rose rose by 0.3%, which was slightly better than expected. Consensus forecasts were calling for a rise of 0.2%.
The report said that for the year core inflation rose 2.4%, the “largest 12-month increase since July 2018.”
Gold prices are were up more than 1% on the day ahead of the inflation numbers and have seen little changes in initial reaction. Gold prices have rallied higher after the European Central Bank announced dovish monetary policy initiatives.
According to some economists, the Federal Reserve is expected to follow suit with its own easing measures next week. They have added that the latest inflation data does nothing to change current market expectations.. December gold futures last traded at $1,527.70 an ounce, up 1.63% on the day.