Gold prices fell on Friday but headed for a third straight quarterly gain as investors eyed key U.S. inflation data due later in the day that could shed light on the Federal Reserve’s stance on interest rate cuts.
FUNDAMENTALS
* Spot gold was down 0.3% at $2,321.39 per ounce at 0157 GMT. Prices are up about 4% for the quarter. The metal remained flat for both the week and the month.
* U.S. gold futures were down 0.2% at $2,332.10.
* The dollar rose 0.2%, making gold more expensive for holders of other currencies, while benchmark 10-year yields also rose on the day.
* The Personal Consumption Expenditures (PCE) price index report, due at 1230 GMT, is on investors’ radar for further guidance on the timing and size of possible rate cuts this year.
* The fading economic momentum was underlined by data showing business spending on equipment fell in May, while plunging exports widened the goods trade deficit.
* In its third estimate of gross domestic product for the January-March quarter, the government confirmed that economic growth moderated sharply in the first quarter.
* US Federal Reserve Governor Michelle Bowman reiterated on Thursday that she is not yet ready to support a central bank rate cut as inflationary pressures remain high.
* Higher interest rates increase the opportunity cost of holding unprofitable bullion.
* Spot silver fell 0.5% to $28.91 an ounce, platinum rose 0.7% to $994.42 and palladium gained 1.5% to $943.22.
DATA/EVENTS (GMT) 0600 UK GDP QQ, YY Q1 0645 France CPI (EU standard) Preliminary YY, MM June 0645 France CPI Preliminary MM NSA June 0645 France Producer Prices YY May 0755 Germany Unemployment Chg, Rate SA June 1230 US Consumption, Adjusted MM May 1230 PCE Core Price Index MM, YY May 1230 US PCE Price Index MM, YY May 1400 U Mich sentiment US Final June (Reporting by Sherin Elizabeth Varghese in Bengaluru)
