Gold Price Finally Ends Four-Day Winning Streak as Cooling Inflation Trims Haven Appeal
Gold finally slipped Thursday after a softer producer price report eased inflation-hedge demand, even as cooler inflation trimmed rate-hike expectations and Treasury yields.
Gold and silver prices went down in the afternoon session Thursday, snapping gold's four-day climb, due to the recent inflation news that trim down Treasury yields and the chances of rate hikes. Gold price sat near $4,351 an ounce, off by about 1.3%, while silver price changed hands at $64.48, down 1.27% on the session.
North American equities finished higher. Positioning now tilted more toward a possibility of next September Federal Reserve hold after Thursday's producer-price and job data. PPI was flat in July, below the expected 0.2%, while producer prices climbed 4.7% from a year earlier.
September Fed rate-hike odds dropped to 34.6% from 40.6%, and the 10-year Treasury yield eased to 4.648% from 4.686%.
The Hormuz situation remains the chief geopolitical issue when it comes to oil and inflation expectations, though Thursday's market effect was muted. WTI and Brent crude prices have been falling in the past 24 hours, although they modestly held their position above $80 per barrel.
For gold, the possibilities stay two-sided, softer crude price and lower yields cool the Fed's possibility to hike rates for now, but lingering shipping issues in the region turns gold as a moderate risk in the near term.
Related assets: Gold, Silver, Palladium, Platinum