(Kitco News) - The gold market is holding steady after the latest data shows U.S. producers saw moderate price pressures last month.
The headline Producer Price Index (PPI) rose 0.2% in October, following September’s revised 0.1% reading, the U.S. Labor Department announced on Thursday. The latest inflation data was in line with expectations, as economists looked for a 0.2% increase.
In the last 12 months, headline wholesale inflation increased 2.4%, the report said, above the consensus of 2.3% and also above September’s revised 1.9% reading.
Core PPI, which strips out volatile food and energy costs, rose 0.3% in October, also in line with economists’ 0.3% consensus forecast and following September’s unrevised 0.2% reading. Annual core PPI was 3.1%, above the consensus expectation for a 3.0% reading and September’s 2.8% print.
Gold prices continued to trade in the middle of their daily range after the 8:30 am EDT data release. Spot gold last traded at $2,554.06 for a loss of 0.73% on the day.
PPI is viewed as a leading inflation indicator as producers pass higher input costs on to their customers.
Market analysts have said that falling producer prices, combined with improving CPI inflation, would give the Federal Reserve the confidence to continue lowering interest rates at upcoming meetings, which would help support gold’s long-term uptrend.
