Gold rose for a second straight day on a decline in US yields as core inflation data faded.
This suggests that the Federal Reserve (Fed) can ease policy without worrying about the current disinflationary pressure.
At 9.20 am, gold was at $2,699.42, up 0.10% since it opened in early trade on Thursday in the Asian session.
The US Bureau of Labor Statistics (BLS) revealed that core consumer inflation fell compared to estimates and the previous month’s reading.
The US yield data fell as there was a growing chance that the Fed would not rule out a rate cut following its December meeting.
Following the release, the market estimated that the US central bank would cut 40 basis points of easing by the end of 2025.
However, gold faces a bigger challenge as the incoming Donald Trump administration imposes tariffs that could fuel inflation and prevent the Fed from lowering borrowing costs.
Currently, financial markets are focused on US Retail Sales, Unemployment Claims and the Fed speech.
