Gold prices rose on Friday and on track for their first weekly gain in four after U.S. economic data indicated a softening of price pressures, fueling optimism that a rate cut by the Federal Reserve could be forthcoming.
Spot gold was up 0.8% to $2,320.90 U.S. per ounce. Bullion has gained 1.3% so far for the week.
Safe-haven demand driven by geopolitical and economic uncertainty, as well as persistent central bank buying contributed to a rally in gold from March to May, taking spot prices to a record $2,449.89 per ounce on May 20.
Now, some experts say, gold appears to be stuck near a level of $2,300 as the metals sector in general undergoes consolidation with no significant downside levels broken or challenged.
Supporting prospects for non-yielding bullion, traders are now seeing a 67% probability of a U.S. rate cut in September, after U.S. data this week showed that consumer prices were unchanged in May for the first time in nearly two years and producer prices unexpectedly fell in May.
