Gold Settles Higher After Inflation Data

Gold prices recovered from earlier losses and reached their highest level in a week on Wednesday, supported by the second consecutive session of U.S. Treasury bond yields pulling back from their recent highs, especially as recent inflation data reduced reflation fears and increased investors’ demand for long-term debt instruments.

Spot gold is up by 0.55% for the day at $1,724.8 per ounce, its highest level since March 3.

Meanwhile, gold futures finished higher by 0.3% at $1,721.80 per ounce.

The $1,700 level is now seen as the key support level for the yellow metal, which could be heading towards $1,730 as bond yields continue to retreat.

Data by the United States Bureau of Labor Statistics showed that the Core Consumer Price Index (CPI) in February registered 1.3%, below market expectations of 1.4%.