Gold scales nine-month high above $1,900/oz level

Gold prices firmed above the key $1,900 level on Friday, hitting their highest since late April after a surprise decline in US consumer prices boosted bets for slower Federal Reserve interest rate hikes, reports Reuters.

Spot gold was up 0.4 per cent at $1,905.19 per ounce, as of 1008 GMT. The metal has risen 2.1 per cent so far in the week, heading for a fourth straight weekly gain.

US gold futures rose 0.5 per cent to $1,907.90.

"Should the Fed fail to hit back against market expectations that peak US rates is close at hand and that an eventual rate cut remains on the table, that may tempt gold bulls to hone in their sights on $2k gold," said Han Tan, chief market analyst at Exinity.

Gold prices rose as much as 1.3 per cent on Thursday to cross the $1,900 per-ounce threshold for the first time since early May 2021, after data showed U.S consumer prices fell for the first time in more than 2-1/2 years in December.

Bullion was also supported by comments from Fed policymakers that the central bank could scale back the pace of its interest rate hikes as inflation eased further in December. However, they cautioned rates were likely to remain higher for longer.

"With the Fed still expected to hike rates at the coming meetings, we still (see) some risk of short-term price (pull)back and renewed ETF outflows," UBS analyst Giovanni Staunovo said.