Gold Holds Steady as Treasury Yields Offset Weak Dollar Ahead of Crucial U.S. Inflation Data

Gold prices remained largely unchanged on Friday, with stronger U.S. Treasury yields countering the support typically provided by a softer dollar, while market participants looked ahead to key inflation data that could shape expectations for the Federal Reserve’s next policy moves.

As of 0524 GMT, spot gold was steady at $4,215.92 per ounce, positioning the metal for a 0.3% weekly decline. U.S. gold futures for December delivery inched 0.1% higher to $4,245.70 per ounce.

Benchmark 10-year U.S. Treasury yields continued to hover around their highest levels in more than two weeks. The U.S. dollar, meanwhile, drifted near a five-week low against major currencies, offering some support to bullion by making dollar-denominated gold more appealing to international buyers.

Kunal Shah, head of research at Nirmal Bang Commodities, described the current market tone, stating, “So the market is waiting for fresh triggers which can come in the form of what the Fed is going to do and (gold) is just consolidating after a brief run in the month of November, but the trend going forward looks to be on the upside.” Shah also noted that the elevated Treasury yields were adding pressure to gold prices.

Recent U.S. economic data added to the market’s anticipation. Jobless claims fell to 191,000 last week, marking their lowest level in more than three years and significantly below the 220,000 projection. Meanwhile, ADP data on Wednesday showed private-sector payrolls dropping by 32,000 in November—the steepest decline in more than two and a half years.

According to a poll of over 100 economists, most expect the Federal Reserve to implement a 25-basis-point rate cut at its December 9–10 meeting as policymakers aim to support a cooling labor market. Lower interest rates generally enhance the appeal of non-yielding assets such as gold.

Investors are now focused on the delayed release of the September Personal Consumption Expenditures (PCE) Index, the Fed’s preferred inflation gauge, due at 1500 GMT.

In the broader precious metals market, silver climbed 1% to $57.68 per ounce, setting itself up for a weekly gain after hitting a record high of $58.98 on Wednesday. Platinum dipped 0.1% to $1,644.04, heading for a weekly loss, while palladium rose 1.1% to $1,464.70 and appeared poised to finish the week higher.

By fLEXI tEAM