Gold rises 0.19% to $4,155.60 on softer US inflation

Gold futures settled slightly higher on Wednesday, September 30, extending gains from the previous session after the personal consumption expenditures price index printed below market forecasts. The PCE index is the preferred inflation gauge of the Federal Reserve. On the Comex division of the New York Mercantile Exchange, gold futures for October delivery rose 0.19% to close at $4,155.60 per troy ounce.

Headline PCE inflation rose 3.4% year on year in August, coming in below the consensus estimate of 3.7%. Core PCE, which strips out volatile food and energy components, increased 3% on an annual basis, below the projected 3.3%.

The inflation print reinforced remarks made on Tuesday, September 29, by John Williams, president of the Federal Reserve Bank of New York, who stated that there is no urgency to adjust monetary policy, even though he noted that one more tightening measure before year end may be appropriate. Data compiled by CME Group showed that 60.7% of market bets now point to unchanged interest rates at the next Fed meeting, up from 29.1% a week ago. Market attention turns to the official US nonfarm payrolls report due on Friday, October 2.