Gold Steadies Near $3,400 Ahead of PCE Data and Fed Independence Fight

Gold held just below the $3,400-an-ounce mark on Thursday, consolidating a two-day rally as investors positioned for Friday’s U.S. personal-consumption-expenditures price index, the Federal Reserve’s preferred inflation gauge. Spot bullion was last quoted at $3,399.60 an ounce after touching $3,401.73, its highest level since Aug. 11. The dollar index slipped 0.1% and the 10-year Treasury yield hovered near 4.23%, providing modest support for the non-yielding metal. Economists polled by Reuters expect PCE inflation to rise 2.6% year on year in July, matching June. Derivatives tracked by the CME FedWatch Tool assign an 87% probability to a 25-basis-point rate cut at the Fed’s September meeting. Gold, which pays no interest, typically benefits when borrowing costs fall or when expectations of easier policy firm up. Traders are also weighing President Donald Trump’s effort to remove Federal Reserve Governor Lisa Cook, a move Cook has vowed to contest in court. The dispute has revived concerns about the central bank’s independence, a factor analysts say could enhance gold’s appeal as a hedge against policy uncertainty. In other precious metals, spot silver gained 0.5% to $38.82 an ounce, platinum was little changed at $1,345.75 and palladium added 0.4% to $1,096.29. Gold has traded in a relatively tight range since setting a record above $3,500 in April, with investors awaiting clearer signals on U.S. inflation, monetary policy and political risk.