Gold gains with dollar, Treasury yields weaken after US inflation data

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(Reuters) – Gold gained on Thursday as dollar and Treasury yields fell after U.S. consumer price data suggested inflation may have peaked in April, allaying some concerns regarding more aggressive rate hikes by the Fed.

A weaker dollar makes gold attractive to overseas buyers, while falling Treasury yields reduce the opportunity cost of holding zero-return bullion.



FUNDAMENTALS

* Spot gold rose 0.2% to $1,855.11 an ounce, by 0103 GMT, after rising 1.1% in the previous session. US gold futures rose 0.2% to $1,856.90.

* The dollar fell, boosting demand for gold at the price of the greenback, after economic data showed inflation remained high but the US central bank was unlikely to adopt more aggressive monetary policy . [USD/]

* The consumer price index (CPI) rose 0.3% last month, the smallest gain since August, the Labor Department said on Wednesday, down from a 1.2% month-on-month rise to the other of the CPI in March, the strongest increase since September 2005.

* Benchmark 10-year U.S. Treasury yields fell after data failed to allay concerns that the Federal Reserve’s program to cool rising prices could induce a recession. [US/]

* The Fed raised its benchmark overnight interest rate by half a percentage point last week, the biggest rise in 22 years, as it struggles to unwind ultra-low monetary policy pandemic-era flexible and tries to fight against soaring inflation.

* Spot silver rose 0.1% to $21.57 an ounce, while platinum fell 0.2% to $990.64 and palladium fell 0.7% to 2 $021.16.

DATA/EVENTS (GMT)

0600 UK GDP East 3M/March 3M

0600 UK GDP estimate MM, YY March

0600 UK Manufacturing MM March

0600 Preliminary QQ British GDP, YY Q1

(Reporting by Bharat Govind Gautam in Bengaluru; Editing by Vinay Dwivedi)

(Only the title and image of this report may have been edited by Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

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