Investing.com - Gold posted mild gains in Asia on Friday with inflation data later in the U.S. that could set a firmer tone on the prospects of Federal Reserve rate hikes later this year.
On the Comex division of the New York Mercantile Exchange, gold for June delivery rose 0.12% to $1,267.95 a troy ounce.
Silver futures for May delivery gained 0.30% to $17.605 a troy ounce, while copper futures for May delivery eased 0.04% to $2.227 a pound.
Investors await the release of key U.S. inflation data on Friday for a more accurate gauge of price stability in the world's largest economy. In February, the Core PCE Index, remained unchanged at 1.7%, one month after soaring to its highest annual rate since late-2012. Core PCE Inflation, which strips out volatile food and energy prices, is the Fed's preferred gauge for inflation.
As well, Greece has popped back into the news as a review of its economic reforms looks snagged.
Overnight, gold surged more than 1% on Thursday, reaching near one-month highs, as investors continued to digest dovish signals from the Federal Reserve on the gradual path of tightening it will pursue in the coming months after the U.S. central bank's latest decision to leave short-term interest rates unchanged.
Market players continued to react to the Federal Open Market Committee's (FOMC) relatively dovish monetary policy statement on Wednesday when the FOMC held interest rates steady for a third consecutive meeting. In December, the FOMC abandoned a seven-year zero interest rate policy by lifting its benchmark Federal Funds Rate by 25 basis points to a target range between 0.25 and 0.50%. The move at the end of last year marked the first rate hike by the Fed in nearly a decade.
Before the FOMC meets again in June, the Committee said it will assess economic conditions, measures of labor market conditions, indications of inflationary pressures and expectations, as well as readings on financial and international developments as it determines the size of future adjustments to the Federal Funds Rate. Notably, the FOMC did not rule out a June rate hike in Wednesday's statement.
"The Committee expects that economic conditions will evolve in a manner that will warrant only gradual increases in the federal funds rate; the federal funds rate is likely to remain, for some time, below levels that are expected to prevail in the longer run," the FOMC said in the policy statement.
"However, the actual path of the federal funds rate will depend on the economic outlook as informed by incoming data."
On Thursday, the CME Group's (NASDAQ:NASDAQ:CME) FedWatch tool lowered the probability of a June rate hike to 15.0% from 100% during the previous session. The CME Group also increased the chances that the Fed will wait until September before raising rates again to 38.8%, up from 30% on Wednesday.
Any rate hikes by the Fed this year are viewed as bearish for gold, which struggles to compete with high-yield bearing assets in rising rate environments.