Gold is approaching a one-month high

Gold prices stabilized today, after hitting their highest levels in more than a month, as core inflation data in the United States reinforced expectations of a cut in interest rates.

Gold in instant transactions recorded $2,696.30 per ounce by 0301 GMT, after recording its highest level since December 12 earlier in the session. Gold futures in the United States rose 0.3 percent, recording $2,725.20.

“Slowing core inflation in the US has renewed hopes for a less restrictive policy by the US Federal Reserve (the central bank) this year,” said Jigar Trivedi, an analyst at Reliance Securities. “Core inflation slowed unexpectedly, while headline consumer prices did not show “Any major upside surprises.”

“This supported demand for bullion as progress in reducing inflation may prompt the Federal Open Market Committee to ease monetary policy.”

Concerns remain about potential tariffs from the administration of US President-elect Donald Trump, which could exacerbate inflationary pressures.

Officials at the US Central Bank said that the data issued yesterday showed a continued decline in inflation, even in light of the uncertainty, amid anticipation of indicators about the policies of the new US administration led by Trump.

The chances of the US Central Bank taking a decision to reduce interest rates this year have increased.

As for other precious metals, silver fell in spot transactions by 0.2 percent to $30.61 per ounce, and palladium fell by 0.3 percent to $958.50. Platinum settled at $938.25.