Gold Edges Higher In Cautious Trade

Gold prices rose slightly on Thursday as investors positioned for a protracted period of high U.S. interest rates and awaited more economic data for guidance on future rate hikes.

Spot gold rose 0.3 percent to $1,881.68 per ounce, while U.S. gold futures were up 0.1 percent at $1,893.35.

The dollar is losing traction amid optimism about China’s economic growth rebounding from reopening drive.

U.S. Treasury yields dipped as investors digested comments from several Federal Reserve officials.

New York Fed President John Williams said interest rates may need to be kept at an elevated level for a “few years” to bring down inflation.

Governor Christopher Waller warned of interest rates going higher than expectations while Governor Lisa Cook said the big job gains in January with moderating wage growth increased her hopes for a “soft landing”.

In economic releases, U.S. weekly jobless claims data, an indicator of the state of the labor market, will be released later in the day while a reading on consumer sentiment that includes readings on inflation expectations will be out on Friday.

Focus is also on U.S. consumer price index inflation data due next week after several Federal Reserve officials stressed the need to keep raising interest rates.

Inflation remains elevated but there are encouraging signs that supply-demand mismatches were easing in many sectors of the economy, U.S. Treasury Secretary Janet Yellen said on Wednesday.

German inflation slowed to a five-month low in January as gas subsidy and a mild winter has led to a decrease in energy prices, preliminary data showed earlier today.

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