Mumbai, 13 Dec (Commoditiescontrol): Gold prices remained steady on Friday, with investors refraining from major moves ahead of the U.S. Federal Reserve's upcoming decision on interest rates next week. Spot gold held firm at $2,681.55 per ounce, poised for a weekly gain of nearly 2%. However, U.S. gold futures edged down 0.1% to $2,705.40.
Earlier this week, gold briefly touched a five-week high before retreating over 1% on Thursday due to profit-taking. Despite this, the precious metal continues to benefit from growing expectations of a rate cut by the Federal Reserve. According to the CME’s FedWatch Tool, traders see a 98.4% probability of a 25-basis-point rate reduction at the Dec. 17-18 meeting.
Data released earlier this week showed U.S. consumer prices rising at the fastest pace in seven months, while producer prices also exceeded expectations in November, largely driven by a surge in food costs. These developments have solidified market bets on an interest rate cut. Gold, which thrives in a low-interest-rate environment, stands to gain further if the Fed moves to lower borrowing costs.
Meanwhile, central banks in Europe continue to adopt easing measures. The European Central Bank implemented its fourth rate cut of the year on Thursday, while the Swiss National Bank made its largest rate reduction in nearly a decade, slashing rates by 50 basis points.
In related markets, SPDR Gold Trust, the largest gold-backed exchange-traded fund, reported a 0.56% drop in its holdings, falling to 868.50 tons from 873.38 tons on Wednesday.
Other precious metals showed mixed trends. Spot silver remained flat at $30.94 per ounce, platinum fell 0.3% to $927.50, and palladium dipped 0.5% to $965.22.
As the week concludes, traders are likely to remain cautious, with next week's Federal Reserve decision expected to set the tone for gold's performance in the near term.
(By Commoditiescontrol Bureau: 09820130172)
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