Gold trading surged higher in the Asian session after US inflation data showed weaker -than -expected readings and this caused US treasury yields and the US dollar to stop rising.
The consumer price index (CPI), which measures inflation, met market expectations by rising 0.4% in February. However, core inflation rose only 1.3% compared to expectations for a 1.4% increase.
These readings suggest that rising inflation is not as feared by markets who are worried it will exceed the 2% target by the Federal Reserve (Fed).
As a result, 10 -year US bond yields continued to hover around the 1.5% level and greenback dollar trading continued to decline against most major currencies at the beginning of the Asian session.
The decline gave the yellow metal a boost to a one -week high and traded around $ 1,731 an ounce (12.15pm Malaysian time).
Meanwhile, the $ 1.9 trillion stimulus package bill got easy approval on Wednesday after going through debate at the House level. President Joe Biden is expected to sign it into law on Friday.
