Gold gains 1pc as rising Fed rate cut bets boost appeal

Gold climbed 1 per cent to a near three-week peak on Friday as the dollar and US Treasury yields slipped on rising expectations that the Federal Reserve will cut interest rates early next year, reports Reuters.

Spot gold was up 1.2 per cent to $2,069.34 per ounce as of 1443 GMT, its highest since Dec. 4, putting it on course for a 1.8 per cent weekly gain. US gold futures rose 1.48 per cent to $2,081.60.

"Precious metals, including gold, are being driven higher by very aggressive rate cut expectations with the market pricing in a Fed cut in March and a total of 150 bps in 2024," said Tai Wong, a New York-based independent metals trader.

"It's priced for perfection but the market usually discounts too zealously."

Traders on Friday stuck to the view that the US central bank will start cutting rates in March after government data showed price pressures continued to cool last month.