Investing.com – Gold prices extended gains to hit a more than two-week high on Friday, as the release of disappointing U.S. inflation data dented hopes for an upcoming U.S. rate hike and sent the greenback broadly lower
Comex gold futures were up $6.67 or about 0.51% at $1,303.09 a troy ounce by 09:00 a.m. ET (13:00 GMT), their highest since September 26.
The U.S. dollar was hit after the U.S. Commerce Department said consumer prices rose less than expected in September, both on a monthly and annual basis.
A separate report showed that U.S. retail sales also increased less than analysts had anticipated last month. However, the core reading exceeded market expectations.
Some fear that a lower than expected increase in U.S. inflation could prevent the Fed from raising interest rates in December.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.27% at 92.70, just off a more than two-week trough of 92.59 hit immediately after the U.S. data was released.
Gold is sensitive to moves in both U.S. rates and the dollar. A weaker dollar makes gold less expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
Elsewhere on the Comex, silver futures gained 0.40% to $17.34 a troy ounce.