WASHINGTON (dpa-AFX) - Partially offsetting the losses from six previous sessions, gold prices have climbed sharply on Thursday as today's data on U.S. economy is in line with expectations, lowering concerns of rate hikes. The consequential slide in U.S. Dollar Index supported the yellow metal.
Front Month Comex Gold for August month delivery has moved higher by $36.30 (or 0.91%) to $4,045.10 per troy ounce
Front Month Comex Silver for August month delivery has climbed by $0.232 (or 0.40%) to $58.540 per troy ounce
On the economic front, data released by the U.S. Bureau of Economic Analysis today revealed that the U.S. economy expanded at an annualized 2.10% in Q1 2026, revised up from 1.60% in the second estimate, and above 0.50% in Q4 2025.
On a month-on-month basis, core Personal Consumption Expenditures index rose by 0.30% from May, in line with market expectations and on a year-on-year basis, it rose by 3.40% in May.
On a quarterly basis, the core PCE index increased by 4.40% in Q1 2026, up from 2.70% of the previous quarter.
On a month-on-month basis, the PCE index rose 0.40% in May lower than market forecasts of a 0.50% advance, and year-on-year, it increased 4.10% in May, matching market expectations.
On the jobs front, data released by the U.S. Department of Labor showed that the unemployment benefit claims eased by 12,000 to 215,000 for the third week of June, below market expectations.
The continuing jobless claims increased to 1,821,000 over the week ending June 13 from 1,800,000 of the previous week.
With the numbers coming nearly in line with forecasts, rate hike concerns diminished.
Last Wednesday, as expected by market participants, U.S. Federal Reserve maintained the interest rates in the current 3.50% to 3.75% range.
Following the announcement, Fed's Summary of Economic Projections (or Dot Plot) drew the attention of investors.
Among the 18 Federal Open Market Committee officials, nine have indicated a minimum of one rate-hike this year while the other nine forecasted the rates to be at the same level.
The U.S. dollar index was last seen trading at 101.40, down by 0.20 (or 0.20%) today.
According to CME Group's FedWatch Tool, currently investors are betting on a 27.80% chance of a quarter-basis-point interest rate-hike in the upcoming Federal Reserve's meeting on July 28-29 while the bets on rates being held at the same level stand at 72.20%.
Last week, U.S. President Donald Trump and Iran's President Masoud Pezeshkian signed a Memorandum of Understanding to extend the ceasefire for 60 days with an agreement to arrive at a framework for future discussions in this interval.
The initial round of talks between the high-level negotiators from both nations concluded in Switzerland on Monday while the technical round discussions are set to go on through this week.
Following the MoU, Iran reopened the Strait of Hormuz which it had shut at the beginning of the war. The U.S. lifted its naval blockade on ships entering or exiting Iranian ports.
Later, the U.S. Treasury gave a license to Iran to exports its oil and petroleum products until August 21.
Though ship traffic has re-commenced across the Strait of Hormuz, vessels are cautiously journeying to avoid the mines laid by Iran during the conflict. As per the agreement, Iran should clear the mines in around 30 days.
Crude oil prices skyrocketed after the breakout of war due to supply disruption concerns. With traffic picking up, it nosedived since last Wednesday.
In a related development, U.S. Senate backed Trump on Iran war powers, rejecting a resolution to limit Trump's authority over Iran war.
Investors are uncertain about gold prices for this year due to the unpredictability in market conditions after the 60-day ceasefire.
Goldman-Sachs pruned its year-end gold price target to $4,900 per ounce from $5,400 per ounce.
JP Morgan Global Research lowered the annual average estimate to $5,243 per ounce from $5,708 per ounce.
UBS projected gold to trade at $5,200 by June and around $5,400 by September.
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