WASHINGTON (dpa-AFX) - Gold prices climbed higher on Thursday as the dollar weakened and bond yields dropped after data showing a drop in U.S. consumer price inflation raised hopes of an interest rate cut by the Federal Reserve as early as September.
The dollar index, which dropped to 104.08 after the release of the inflation report, recovered to 104.51 subsequently, but still remained well below the previous close.
Gold futures for July ended higher by $42.80 or about 1.8% at $2,415.00 an ounce, recording the largest single session upmove in terms of percentage and dollar, since March 1, 2024, and December 14, 2023, respectively.
Silver futures for July ended up $0.667 or about 2.2% at $31.394 an ounce, while Copper futures for July dropped to $4.5090 per pound, down $0.0985 from the previous session.
The Labor Department said U.S. consumer price index slipped by 0.1% in June after coming in unchanged in May. Economists had expected consumer prices to inch up by 0.1%.
Excluding food and energy prices, core consumer prices crept up by 0.1% in June after rising by 0.2% in May. Core prices were expected to increase by another 0.2%.
The report also said the annual rate of consumer price growth slowed to 3% in June from 3.3% in May. Economists had expected the pace of price growth to decelerate to 3.1%. The annual rate of core consumer price growth also slowed to 3.3% in June from 3.4% in May. The pace of growth was expected to remain unchanged.
A separate data from the Labor Department showed first-time claims for U.S. unemployment benefits fell by much more than expected in the week ended July 6th, dropping to 222,00, a decrease of 17,000 from the previous week's revised level of 239,000.
Economists had expected jobless claims to edge down to 236,000 from the 238,000 originally reported for the previous week.
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