WASHINGTON (dpa-AFX) - Gold futures settled slightly down on Friday, but posted gains for a third straight week amid rising prospects of an interest rate cut by the Federal Reserve in September.
A weak dollar limited the bullion's downside. The dollar index dropped to 104.04, losing nearly 0.4%.
Gold futures for July ended down $1.00 at $2,414.00 an ounce. For the week, the contract gained $25.50 or about 1.1%, an ounce.
Silver futures for July settled lower by $0.508 or 1.6% at $30.886 an ounce. Silver futures lost 1.6% in the week.
Copper futures for July climbed to $4.5980 per pound, gaining $0.0895.
According to CME Group's FedWatch Tool, the chances a rate cut in September have jumped to 84.6 percent compared to 69.7 percent on Wednesday.
Comments from some Fed officials have also helped fuel rate cut hopes. San Francisco Fed president Mary Daly on Thursday said she expects further easing in both price pressures and the labor market, and therefore some policy adjustment will be warranted.
Chicago Fed President Austan Goolsbee described the latest inflation data as 'excellent,' adding the reports prove that the central bank is on track to meet its 2 percent target.
St. Louis Fed President Alberto Musalem also said cooler inflation data is 'encouraging' and the current level of the federal funds rate is 'the appropriate posture for policy at the current juncture'.
In economic news today, a report from the Labor Department said its producer price index for final demand rose by 0.2% in June following a revised unchanged reading in May. Economists had expected producer prices to inch up by 0.1% compared to the 0.2% dip originally reported for the previous month.
The report also said the annual rate of producer price growth accelerated to 2.6% in June from an upwardly revised 2.4% in May. The annual rate of producer price growth was expected to creep up to 2.3% from the 2.2% originally reported for the previous month.
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