Video: LSE-listed uranium junior Power Metals lands in North America
The company holds a portfolio including precious, base and strategic metal exploration in North America, Africa, Saudi Arabia and Australia.
Gold retreated for the second day in a row following data showing an acceleration in US consumer prices, fueling expectations that the inflation may not prompt a big change in the Federal Reserve’s interest rate strategy.
Spot gold was down 0.2% at $1,910.25 per ounce by noon EDT Wednesday, the lowest in more than two weeks. US gold futures also fell 0.2% to $1,932.20 per ounce in New York.
[Click here for an interactive chart of gold prices]
New data from the US Labor Department showed headline and core CPI in August rose 0.6% and 0.3% month-on-month, respectively. Economists were expecting increases of 0.6% and 0.2%, respectively.
However, traders’ expectations for the Fed leaving interest rates unchanged at its Sept. 19-20 policy meeting only got stronger after the data, while pricing around a 44% chance of another hike before 2024, according to the CME FedWatch tool.
“Precious metal investors are less worried about higher inflation and more focused on the opportunity costs associated with holding a non-interest bearing asset in a rising rate environment,” said Chris Gaffney, president at EverBank World Markets, in a Reuters note.
But “focus now shifts to the retail sales numbers which some investors feel is an even more important indicator than the CPI info we got today.”
Evercore ISI vice chairman Krishna Guha told Bloomberg that while the report isn’t amazing as far as policy goes, it’s not a disaster either. “Not a great CPI report, but not something that changes the basic Fed outlook,” Guha said.
Investors are now looking forward to the August producer prices and retail sales data and the European Central Bank’s rate hike verdict on Thursday ahead of the Fed’s policy decision next week.
(With files from Reuters)
