Gold prices tick higher on US rate cut bets

Gold prices edged up for a second session on Tuesday, after recent economic data boosted bets that the Federal Reserve would cut interest rates later this year.

FUNDAMENTALS

* Spot gold rose 0.2% at $2,327.11 per ounce, as of 0034 GMT. U.S. gold futures firmed 0.2% to $2,336.20.
* Traders are pricing in a 64% chance of a Fed rate cut in September, as per CME‘s FedWatch Tool. Lower rates increase the appeal of holding non-yielding bullion.

* Data on Friday showed job growth in the U.S. slowed more than expected in April, while the increase in annual wages fell below 4.0% for the first time in nearly three years.

* Fed Bank of New York President John Williams said on Monday that at some undefined point the U.S. central bank will lower its interest rate target. * Investors closely monitored the latest developments in the Middle East conflict. Palestinian militant group Hamas on Monday agreed to a Gaza ceasefire proposal from mediators, but Israel said the terms did not meet its demands and pressed ahead with strikes in Rafah while planning to continue negotiations on a deal. * SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose 0.21% to 832.19 tonnes on Monday from 830.47 tonnes on Friday. * Spot silver fell 0.1% to $27.44 per ounce, platinum gained 0.5% to $958.90 and palladium rose 0.4% to $981.34.

* A private sector survey showed on Monday that China’s services activity expansion slowed a touch, but growth in new orders accelerated and business sentiment rose solidly.