Gold futures on Thursday were headed slightly lower, and in danger of snapping a four-session streak of gains as investors await a fresh reading on U.S. inflation.
Investors will be watching for the December producer price index report after consumer prices rose 0.5% in December to push the increase in the cost of living last year to a nearly 40-year high of 7%, underscoring the belief that high U.S. inflation is likely to persist in 2022. The producer-price index will be released at 8:30 a.m. ET.
Gold is traditionally viewed as a hedge against inflation, but the surge in prices for goods and services, caused by supply-chain bottlenecks and a revival in consumer demand in the wake of the COVID pandemic, is also likely to compel the Federal Reserve to lift interest rates at a faster than expected pace this year and may weigh on precious metal prices.
Against that backdrop, gold prices were edging lower Thursday, with February gold
GCG22,
GC00,
off $3.80, or 0.2%, to $1,823.50 an ounce, after climbing 0.5% in the previous session. Prices for the most-active contract ended Wednesday at their highest since Dec. 31 and notched a fourth straight session gain, marking the longest string of gains since a seven-session stretch ended Nov. 12, FactSet data show.
That said, gold has been relatively resilient in the face of volatile financial markets that are looking at the prospect of higher borrowing costs and inflation.
Meanwhile, March silver
SIH22,
SI00,
was picking up 7 cents, or 0.3%, to reach $23.28 an ounce, following a 1.7% advance on Wednesday.
