Gold prices under pressure and finding little support from drop in U.S. PPI Inflation data

London (Mar 12)  Gold prices are under pressure and losing further ground following significantly weaker than expected inflation is having little impact on the precious metal.

Thursday, the U.S. Labor Department said its Producer Price Index (PPI) fell 0.6% in February, following January’s rise of 0.5% ; the data were weaker  than expected with economists’ forecasting an drop of 0.1%.

At the same time core PPI, which strips out volatile food and energy costs, fell 0.3% last month, following January’s increase of 0.5%. Economists were expecting to see a 0.1% rise.

Gold prices are under pressure as volatility market conditions prompt investors to move into cash to wait out the financial storm. Inflation numbers are having little impact on markets as investors are focused on potential economic impact of the spreading coronavirus. April gold futures last traded at $1,609 an ounce, down 2% on the day.

Reuters