Gold Prices Edge Higher as Markets Await Key U.S. PCE Inflation Data

Gold prices moved higher in Asian trading on Friday, supported by a weakening U.S. dollar and strong expectations that the Federal Reserve will cut interest rates at its upcoming December 9–10 meeting. Spot gold rose 0.5% to $4,227.88 an ounce, while U.S. gold futures for February slipped 0.3% to $4,256.95. The softer dollar—hovering near a five-week low—boosted demand for bullion by making it more affordable for international buyers. Markets are currently pricing in an 88% chance of a 25-basis-point rate cut, with traders also anticipating further monetary easing early next year.

Recent U.S. economic data has strengthened the outlook for rate cuts. Weekly jobless claims dropped by 27,000 to 191,000, marking the lowest level since September 2022. Adding to concerns about cooling labor conditions, ADP’s private-sector payroll report showed a decline of 32,000 jobs, the steepest drop in more than two and a half years. These indicators have increased expectations that the Fed may adopt a more dovish stance.

Investors are now focused on the release of the Personal Consumption Expenditures (PCE) price index—the Fed’s preferred inflation gauge. A softer-than-expected reading could reinforce the case for a rate cut this month and potentially open the door to additional easing in 2025. However, rising U.S. Treasury yields continue to limit gold’s upside, as higher yields raise the opportunity cost of holding non-yielding assets like gold.

Other metals also benefited from the weaker dollar. Silver futures gained 2.2% to $58.77 per ounce, platinum added 0.8% to $1,673.60, and copper saw strong momentum, with LME benchmark copper rising 2.1% to $11,675.20 a ton. U.S. copper futures climbed more than 2% to $5.47 a pound, reflecting improving sentiment across industrial metals markets.