Gold held a three-day advance as traders prepared for US inflation data that will help determine whether the US Federal Reserve cuts or holds rates next week at its final meeting of the year.
Spot bullion briefly traded above US$2,700 ($3,623.40) an ounce, after rising by more than 2% in the prior three sessions. Markets are currently pricing in a more than 70% chance of a quarter-point reduction at the Dec 17-18 gathering. Lower borrowing costs typically aid bullion, as it doesn’t pay interest.
Gold hit an all-time high above US$2,790 in October, supported by the Fed’s pivot to easing, haven demand, and central-bank buying.
Prices — which have rallied more than 30% this year — enjoyed a lift in recent sessions after the People’s Bank of China resumed purchases after a six-month pause.
Technical factors were also helping bullion, with trading volumes increasing as futures this week “convincingly” broke out of a consolidation phase, according to Pepperstone Group head of research Chris Weston.
Gold for immediate delivery was little changed at US$2,698.67 an ounce at 8.38am in Singapore, following a 1.3% gain on Tuesday.
See also: Extraordinary year for gold coming to extraordinary end: Julius Baer
The Bloomberg Dollar Spot Index was little changed. Silver edged up toward US$32 an ounce, while platinum and palladium were steady.
