Gold retreats after US inflation data

Gold prices retreated on Wednesday from their record high levels amid a resurgence in the dollar and US Treasury bond yields following the release of data indicating higher-than-expected inflation in the United States. This dampened expectations of an imminent cut in US interest rates.

Spot gold prices declined by 0.6 percent to $2,338.19 per ounce by 1258 GMT, while US gold futures slipped by 0.1 percent to $2,360.7.

The dollar index surged by 0.5 percent, while US Treasury bond yields saw a notable uptick after the release of inflation data, diminishing the allure of the precious metal, which lacks yield-bearing characteristics.

According to a report from the Labor Department, the consumer price index experienced a 0.4 percent monthly increase in March, surpassing analysts’ expectations of a 0.3 percent rise in a Reuters poll.

Tai Wong, an independent metals trader based in New York, attributed the decline in gold prices to the inflation data, which fueled expectations of delayed interest rate cuts and potentially lower rate adjustments in the future.

Gold prices had soared to a record high of $2,365.09 on Tuesday.

In the realm of other precious metals, silver saw a 0.5 percent decline in spot transactions to $28.01 per ounce, following its nearly three-year high reached on Tuesday.

Platinum recorded a 1 percent decrease to $969.05, while palladium experienced a sharper decline of 1.9 percent, settling at $1,071.75.