Feb 11 (Reuters) – Gold and silver prices rose on Wednesday as U.S. Treasury bond yields fell after data showed December retail sales growth stalled, signalling a softening economy ahead of key jobs data.
FUNDAMENTALS
* Spot gold edged 0.3% higher to $5,038.73 per ounce by 0059 GMT.
* U.S. gold futures for April delivery gained 0.6% to $5,060.60 per ounce.
* Spot silver was up 1% at $81.49/oz, after falling more than 3% in the previous session.
* U.S. yields fell on Tuesday after a raft of data suggested the economy may be softening, giving the U.S. Federal Reserve more cushion to cut interest rates. [US/]
* Falling yields reduce the cost of holding metals and often come with macro signals that favour them.
* U.S. retail sales were unexpectedly unchanged in December as households scaled back spending on motor vehicles and other big-ticket items, potentially setting consumer spending and the economy on a slower growth path heading into the new year.
* Federal Reserve Bank of Cleveland President Beth Hammack, however, said on Tuesday that the U.S. central bank faces no urgency to change the setting of interest rates this year amid a “cautiously optimistic” outlook for economic activity.
* Investors expect at least two 25-basis-point rate cuts in 2026, with the first one expected in June. Non-yielding bullion tends to do well in low-interest-rate environments. [FEDWATCH]
* Investors await the non-farm payrolls report for January, due later in the day, and inflation data on Friday for more cues on the Fed’s monetary policy path.
* Indian investors piled into gold exchange-traded funds in January as prices soared amid rising geopolitical risks, surpassing flows into equity funds for the first time, industry data showed on Tuesday.
* Spot platinum added 0.6% to $2,098.78 per ounce, while palladium rose 0.2% to $1,712.25.
DATA/EVENTS (GMT)
0130 China PPI, CPI YY January
1330 US Non-Farm Payrolls January
1330 US Unemployment Rate January
1330 US Average Earnings YY January
(Reporting by Ishaan Arora; Editing by Sherry Jacob-Phillips)
