Gold price plummets Rs3,500 per tola amid hot US inflation report

MG News | February 14, 2024 at 12:06 PM GMT+05:00
February 14, 2024 (MLN): The price of 24-karat gold in the local bullion market plummeted Rs3,500 to Rs210,800 per tola amid hotter-than-expected US inflation data, which fueled bets that Federal Reserve may not cut rates as soon as expected earlier.
The Karachi Sarafa Association reported that the price of 10-gram 24-karat gold was at Rs180,727, reflecting a loss of Rs3,001 compared to previous session.
While the price of 10-gram 22-karat gold fell to Rs165,666.
Silver prices also fell, with 24-karat silver being sold at Rs2,580 per tola, depicting a fall of Rs20 DoD. The 10-gram silver price also decreased by Rs17.15 to Rs2,211.93.
On the global front, international spot gold slipped below $2,000 for the first time in two months. It fell 1.34% or $27 yesterday.
The American CPI data came as a disappointment for investors after a recent downdraft in price pressures that helped build expectations for rate cuts this year, said Bloomberg.
The numbers also gave credence to the wait-and-see approach highlighted by Jerome Powell and a chorus of Fed speakers.
Swap contracts referencing Fed policy meetings, which as recently as mid-January fully priced in a rate cut in May and 175 basis points of easing by the end of the year, were roiled.
The odds of a May cut dropped to about 32% from about 64% before the inflation data, with fewer than 90 basis points anticipated this year.
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