PRECIOUS-Gold moves higher as yields, dollar slip after US inflation data

By Ashitha Shivaprasad and Anushree Ashish Mukherjee

Nov 14 (Reuters) – Gold prices gained on Tuesday as the dollar and Treasury yields retreated after softer-than-expected US consumer inflation data, which fueled more bets that the Federal Reserve may be done hiking interest rates.

Spot gold XAU= was up 0.6% at $1,957.70 per ounce, as of 9:14 am ET (1414 GMT). US gold futures GCcv1 rose 0.7% to $1,963.00.

US consumer prices were unchanged in October and underlying inflation showed signs of slowing. In the 12 months through October, the CPI climbed 3.2% after rising 3.7% in September.

The market is pricing in a 100% chance that the US central bank will leave rates unchanged in December versus 86% before the inflation report, according to the CME FedWatch tool.

“CPI data came in significantly weaker than expected, which is quite supportive for precious metals. We are expecting a significant deterioration in the data over the course of the fourth quarter, which should weaken dollar and support gold,” said Daniel Ghali, commodity strategist at TD Securities.

“Over the next six months, we’re looking at gold prices to rally towards $2,100 per ounce.”

Boosting bullion’s appeal, the dollar index .DXY fell 1% while benchmark 10-year US Treasury yields hit a more than one-month low after the data.

Investors will also keep a tab on the US producer price index data due on Wednesday.

Spot silver XAG= rose 2.3% to 22.81 per ounce.

Commerzbank lowered its price forecast for silver at the end of 2024 to $29 per ounce from $30.

But, it added that this would still see silver noticeably outperform gold, attributing it to a positive outlook for industrial demand and ongoing transformation of the economy towards climate neutrality, in which silver plays an important role.

Platinum XPT= gained 1.4% to $876.39, and palladium XPD= climbed 1.8% to $998.86.

(Reporting by Ashitha Shivaprasad and Anushree Mhukerjee in Bengaluru; Editing by Emelia Sithole-Matarise)

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