Gold approaches a 3-week peak heading towards weekly gains

Gold prices rose to their highest level in 3 weeks during trading on Friday, and are heading towards recording weekly gains, amid increasing bets that the US Federal Reserve will reduce interest rates at the beginning of 2024.

According to Reuters, futures contracts for the yellow metal rose by about 0.4% to $2059.70 per ounce.

Coinciding with gold’s gains was the decline in the dollar index, which measures the performance of the US currency against a basket of 6 major currencies, to its lowest level in 5 months.

According to the CME Group’s VidWatch tool, 83% of traders expect interest rates to be cut by March, which is an issue that boosts the prices of non-yielding gold.

In terms of economic reports, data yesterday, Thursday, revealed that the US economy grew by about 4.9% in the third quarter, which is a lower level than the previous reading, which showed the economy growing by 5.2%.

Today, attention is turning to the report on the personal consumption expenditures index in America for last month, which is the Federal Reserve’s preferred measure of inflation.

In Japan, economic data revealed today that core inflation slowed to its lowest level in 16 months, recording 2.5% in November.