WASHINGTON (dpa-AFX) - Gold prices fell on Thursday, weighed down by concerns the Federal Reserve will cut interest rate just once this year despite data showing a slowdown in consumer price growth.
The dollar index climbed to 105.28 this afternoon, gaining about 0.6%.
Gold futures for June settled at $2,300.20 an ounce, down by $35.80 or about 1.5%, the largest decline in terms of dollar as well as percentage terms, in about a week, and the lowest settlement in six weeks.
Silver futures for June ended down $1.186 or nearly 4% at $28.990 an ounce, while Copper futures dropped to $4.4870 per pound, down 0.0870 or 1.9% from the previous close.
The Federal Reserve, which left rates unchanged on Wednesday, said inflation has eased substantially in recent months but still remains too high.
The accompanying statement from the central bank indicated that more participants expect to cut twice than once, but no one expeccts to cut more than twice. Four policymakers have reportedly said they don't expect a rate cut this year.
European Central Bank Governing Council member Joachim Nagel warned that consumer price growth in the euro zone is proving stubborn and that he and his colleagues won't simply lower borrowing costs automatically.
In U.S. economic releases today, a report released by the U.S. Labor Department today showed the producer price index for final demand dipped by 0.2% in May after climbing by 0.5% in April. Economists had expected producer prices to inch up by 0.1%.
The report also said the annual rate of producer price growth slowed to 2.2% in May from an upwardly revised 2.3% in April. Economists had expected the annual rate of producer price growth to accelerate to 2.5% from the 2.2% originally reported for the previous month.
A separate data from the Labor Department said initial jobless claims climbed to 242,000 in the week ended June 8th, an increase of 13,000 from the previous week's unrevised level of 229,000. Economists had expected jobless claims to edge down to 225,000.
With the unexpected increase, jobless claims reached their highest level since hitting 248,000 in the week ended August 12, 2023.
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