Gold Rises on US Inflation Rise

Gold advanced for the first time in three days after a government report showed the cost of living in the U.S. increased by the most in six months, boosting the appeal of the precious metal as a hedge against inflation.

The consumer-price index rose 0.3 percent, the most since June, following no change the prior month, a Labor Department report showed. Gold slumped 28 percent last year as some investors lost faith in the metal as store of value and consumer costs climbed 1.5 percent in 2013, the smallest calendar-year gain since 2010.

“Inflation is back on everyone’s radar,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “The safe-haven appeal is back to an extent.”

Gold futures for February delivery rose 0.3 percent to $1,242.30 an ounce at 9:50 a.m. on the Comex in New York. Prices fell 1 percent in the previous two sessions.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza