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Gold prices rose sharply, while recovering most of the losses suffered yesterday. Note that the dynamics of trade affected by the publication of U.S. data and yesterday's statement by the head of the Atlanta Fed's Lockhart, who noted that the Federal Reserve may begin to reduce its purchases of bonds in September, despite the fact that inflation remains below the target of government. Furthermore, he added that the U.S. economic indicators are too mixed to ensure that the members of the Federal Reserve reduced the asset purchase program next month, and, ultimately, stopped her. It should be noted that the level of inflation in the U.S. remains well below the 2 percent target set by the Federal Reserve. But Lockhart said he saw no signs of proliferation of deflation. He noted that the current inflationary background is quite compatible with a slight decrease in the volume of purchases. Meanwhile, Lockhart said he saw significant progress in the labor market, but noted that weak economic growth has led to the formation of a pause.
Note also that the Department of Labor issued a report that showed that producer prices in the U.S. unexpectedly remained unchanged in July, as rising pharmaceutical costs offset the fall in energy prices.
The Labor Department said that its producer price index was flat in July after a 0.8% increase in June. Economists had expected the index to rise by 0.4%. Basic producer price index, which excludes food and energy, rose 0.1% in July after rising 0.2% the previous month. According to expectations, the underlying index should have grown by 0.2%.
We add that, according to traders, gold prices are likely to increase in India this week, due to the recent increase in import duty, which was introduced on Tuesday. The Indian government raised the import duty on gold for the third time this year in an attempt to strengthen the rupee and reduce the trade deficit of the country.
The cost of the October gold futures on COMEX today rose to $ 1331.80 per ounce.
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