Gold prices surge amid fed rate cut expectations

• Gold prices hit $2,641.8 per ounce
   
• U.S. inflation rate at smallest increase in 3.5 years
   
• Weekly jobless claims rise to 258,000, above forecast
   
• 84.3% chance of a 25-basis-point Fed rate cut
   
• Geopolitical tensions boost gold demand

On Thursday, gold prices continued to rise as traders boosted their expectations for an interest-rate cut by the Federal Reserve next month, following the latest U.S. economic data.
 

Spot gold increased to $2,641.8 per ounce, aiming to break a six-day losing streak.

In September, U.S. consumer prices edged up slightly more than anticipated, but the annual inflation rate recorded its smallest increase in over three and a half years.

Another report revealed that weekly jobless claims climbed to 258,000 for the week ending October 5, exceeding the forecast of 230,000.

The Consumer Price Index (CPI) report was largely in line with expectations, and the job data indicates a trend of economic weakening, reinforcing the belief that the Fed may lower rates, which supports gold prices.

Markets now see an 84.3% chance of a 25-basis-point cut from the Fed next month.

Investors are also awaiting the U.S. Producer Price Index data today (October 11) for further insights.

Additionally, geopolitical tensions and strong central bank demand are positive factors for gold.