Gold heads for the second week of losses in a row

Gold is headed lower for the second straight week on Friday after an unexpected rise in consumer prices in the United States prompted traders to recalculate their expectations for interest rate cuts. However, bullion recovered some of the losses after a decline in consumer spending.

According to Reuters, by 0427 GMT, gold settled in spot transactions at $2,003.40 per ounce and has lost more than one percent during the week so far. US gold futures reached $2015.30 per ounce.

Data this week showed that inflation pressures remained unchanged, with US import prices for January rising at the largest pace in nearly two years and consumer prices increasing more than expected last month.

Markets are now awaiting another inflation report, the US Producer Price Index, scheduled for release at 1330 GMT.

Jigar Trivedi, a senior analyst at Reliance Securities, said, “It is expected that there will not be a major recovery in gold, and prices are likely to touch the level of 1960-1970 dollars per ounce… Investor sentiment will only go downward.”

The metal recovered some of its losses this week and rose about 0.6 percent on Thursday after US retail sales witnessed the largest decline on a monthly basis since February 2023.

Atlanta Federal Reserve Bank President Raphael Bostic said on Thursday that he was not yet ready to call for lower interest rates and expected two cuts in 2024.

The Federal Reserve is expected to keep interest rates unchanged at its policy meeting next month. Investors expect the first cut to be implemented in June.

As for other precious metals, platinum fell in spot transactions 0.7% to $892.04 per ounce, palladium fell 1.5% to $938.55, while silver rose 0.1% to $22.93 per ounce.