Gold Price Menonjak Sharp Because Of Sequenese Inflation

Gold Price (Foot: ANTARA)

JAKARTA - The sharp price of gold rose near a nine-month high at the end of trading Friday (Saturday morning WIB), extending the increase for a third session in a row driven by expectations of a slower rate hike by the Federal Reserve.

The most active gold contract for February delivery in the Comex division of the New York Exchange, jumped 22.90 dollars, or 1.21 percent, to close at 1,921.70 dollars an ounce, after trading to a session peak of 1,925.30 US dollars and a low of 1,895.10 US dollars.

Gold futures closed above $1,900 on Friday, December 13 for the first time since late April, ending the week 2.8 percent higher.

Gold futures rose 19.90 US dollars or 1.06 percent to 1,898.80 US dollars on Thursday, December 12, after raising 2.40 dollars, or 0.13 percent, to 1,878.90 US dollars on Wednesday, December 11, and declining 1.30 US dollars, or 0.07 percent, to 1,876.50 US dollars on Tuesday, December 10.

The December consumer price index data released Thursday, December 12, confirms that US inflation is on the decline track. But as it is still far from achieving the target of 2.0 percent Federal Reserve inflation, the market estimates the US central bank will continue to raise the benchmark interest rate, but with a slower pace, likely as much as 25 basis points in the next monetary policy meeting on February 1.

Gold has strengthened over the past three months as retroactive inflation pushed back lower government and dollar bond yields amid expectations that the Federal Reserve would be much less aggressive with this year's rate hikes compared to 2022, and may even finish monetary tightening long before the end of this year.

"The price of gold is rising as Wall Street is increasingly convinced that the Fed is nearing its interest rate," said Ed Moya, analyst on online trading platform OANDA. "Goldless gold likes a decrease in bond yields and it can continue as revenue comes weaker than expected," he added. quoted from ANTARA.

Moya said if gold could be "closed comfortably above the $1,900 level, it could be a very bullish signal for the rest of the month", adding that it expects "strong resistance in the region of $1,950" for yellow metals.

The US Department of Labor reported Friday, December 13 that the US import price index rose 0.4 percent in December after a revised 0.7 percent drop in November, surprising economists who expect a 0.8 percent drop.

The University of Michigan's consumer sentiment index, which was released Friday, December 13, rose to 64.6 in the early January survey, the highest reading since January 2022 and up 8.2 percent from December's reading of 59.7.

Another precious metal, silver for March delivery rose 36.8 cents, or 1.53 percent, to settle at 24.372 dollars an ounce. Platinum for April delivery slipped 11.8 dollars, or 1.09 percent, to close at 1,072.50 dollars an ounce.