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Pushes To A Three-Week High After PCE Deflator Data

GOLD

Gold is slightly higher in the Asia-Pac session, after closing 0.5% higher at $2044.30 on Thursday.

  • Bullion rose to a three-week high after inflation figures matched expectations and reinforced bets that the Federal Reserve won’t need to raise interest rates again.
  • US Treasuries finished the NY session 1-2bps richer. The US 10-year yield finished 1bp lower at 4.26% after pushing as high as 4.32% ahead of the PCE deflator data.
  • The US PCE deflator, which is the Fed’s preferred inflation gauge, printed in line with market expectations, with the core measure up 0.4% m/m and 2.8% y/y. This confirmed the jump in inflation in January, as foreshadowed by prior CPI and PPI data.
  • Fed speak remained balanced while leaning toward cut(s) in 2H'24. Fed Bostic reiterated that the central bank is likely going to be in a position to begin easing interest rates sometime in the summer.
  • According to MNI’s technical team, Thursday’s high of $2050.72 cleared resistance at $2041.1 (Feb 23 high) and opened the key level of $2065.5 (Feb 1 high).

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