Gold prices have stalled their three-day rally at monthly highs as traders pause for profit-taking ahead of the inaugural ceremony of U.S. President-elect Donald Trump next Monday.
By 3:45 pm AEDT (4:45 am GMT) spot gold was trading flat at US$2,715.47 per ounce.
The precious metal showed limited reaction to stronger-than-expected economic data from China, the world’s largest consumer of gold. China’s fourth-quarter GDP grew by 5.4% year-on-year, surpassing estimates of 5%, alongside better-than-forecast retail sales and industrial production figures.
Despite the positive economic data, optimism surrounding China's growth is dampened by lingering concerns about its struggling property market and potential tariffs proposed by the incoming U.S. administration.
Meanwhile, expectations of dovish U.S. Federal Reserve policies continue to support gold prices. Following slightly weaker-than-expected inflation data, markets anticipate at least two interest rate cuts in 2024. This outlook has pressured U.S. Treasury yields and the U.S. dollar, reinforcing demand for the non-yielding precious metal.
In addition, comments from Federal Reserve Governor Christopher Waller also weighed on Treasury yields and the dollar. Speaking to CNBC on Thursday, Waller noted that if inflation continues its current deceleration, rate cuts could be on the table as early as the first half of the year.
Looking ahead, gold traders will focus on upcoming U.S. economic releases, including housing data and industrial production figures for potential market-moving cues.
