The latest round of inflation data contained a pleasant surprise for the gold bulls, with a lower-than-expected reading adding even more fuel to the sustained red hot pricing streak.
Ahead of the release of the Producer Price Index (PPI) data yesterday (Thursday), economists had called for a 0.3% increase, building on the 0.6% increase recorded in February. However, the data surprised to the downside, with the Labor Department confirming just a 0.2% rise. The headline inflation figure for the previous 12 months was also lower than expected, coming in at 2.1%, rather then the forecasted 2.2%.
The same data release also showed that core inflation had increased 2.4%, with core PPC up 0.2%. Both of those figures were in in line with forecasts. The figures show just how up and down inflation data can be, given Wednesday’s CPPI index was higher than expected.
In the immediate aftermath of the PPI data release, gold prices spiked, gaining 0.32% on the day, underlining just how strong the yellow metal is right now.
