Gold prices inched up on Thursday, hovering near an eight-week peak on bets that the U.S. Federal Reserve might soon hit pause on its interest rate-hiking cycle.
Spot gold rose 0.1% to $1,978.59 per ounce by 0053 GMT. U.S. gold futures were little changed at $1,981.30.
The dollar index wobbled near a more than one-year low, making gold cheaper for holders of other currencies.
The Fed is expected to raise rates by 25 basis points (bps) in their meeting next week, keeping them in the 5.25%-5.5% range until cuts are seen 2024 onwards, per CME’s Fedwatch tool.
Lower interest rates decrease the opportunity cost of holding non-yielding bullion.
The European Central Bank is also expected to raise rates by 25 bps next week.
Investors will keep an eye out for initial jobless claims data in the U.S. later in the day for the week of July 15, forecast to rise to 242,000 from a seasonally adjusted 237,000.
SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings rose nearly 0.2% to 913.80 tonnes on Wednesday from 912.07 tonnes on Tuesday, rising for the first time in nearly three weeks.