Gold prices slipped on Friday, as a stronger-than-expected US inflation reading and hawkish comments from a Federal Reserve official ramped up odds for a hefty interest rate hike next month, sending Treasury yields higher.
Spot gold fell 0.1% to $1,825.29 per ounce by 0141 GMT, while US gold futures dropped 0.7% to $1,824.50.
US consumer prices rose solidly in January, leading to the biggest annual increase in inflation in 40 years, fuelling speculation for a 50 basis point rate hike from the Fed next month.
St. Louis Federal Reserve President James Bullard said he wanted to see a full percentage point worth of rate hikes over the next three policy meetings by the central bank.
Rate futures showed a 62% chance that the Fed will raise interest rates by 50 basis points in March following Bullard’s remarks, from a 30% chance on Wednesday.
- Economic Times