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Marin Durdov
Jan 11, 2023 5:01PM ET
thoughts? 1900+? or 1860-?
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💎 Reveal Undervalued Stocks Hiding in Any Market Get Started
Gold hits 8-month high below $1,900 ahead of CPI report
© Reuters.
By Barani Krishnan
Investing.com -- Extending its shiny 2023 debut, gold rallied to an eight-month high on Wednesday, stopping short of the $1,900 resistance amid bets that a U.S. inflation report due in the next 24 hours would prod the Federal Reserve to go easier with its rate hikes this year.
Gold for February delivery on New York’s Comex settled at $1,878.90 per ounce, up $2.40, or 0.1%, for the day.
The benchmark U.S. gold futures contract has risen 3% since the start of the year, extending its near 4% gain from December and 7% rally from November. Wednesday’s session high for February gold was $1,890.85, the loftiest level since May, when it got to a peak of $1,910.20.
The spot price of gold, more closely followed than futures by some traders, was at $1,877.66 by 14:30 ET (19:30 GMT) — up 69 cents, or 0.04%, on the day. Spot gold’s intraday peak was $1,886.60 — also the highest since May.
Gold’s rally on Wednesday coincided with the run-up in stocks on Wall Street as traders across markets bet on a sizable drop in inflation numbers from the U.S. Consumer Price Index, or CPI, report due on Thursday.
“Gold’s recent rally has made an eight-month high and it could extend further if disinflation trends remain firmly in place,” said Ed Moya, analyst at online trading platform OANDA.
Economists tracked by Investing.com expect year-on-year CPI growth to have contracted to 6.5% in December from 7.1% in November. Just in June, inflation was roaring at four-decade highs when annual CPI growth came in at 9.1%.
The December CPI reading will determine whether the Federal Reserve will continue to lower rate hikes at its February 1 policy meeting.
The Fed increased rates by a blockbuster 75 basis points four times between June and November, before resorting to a 50-basis point hike in December. For February, the consensus is for a 25-basis point increase.
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Nasrullah Mehdi
Jan 11, 2023 5:01PM ET
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