84% chance of December rate cut - CME FedWatch
Data show US retail sales for Sep slow, producer prices up 2.7%
Fed's system of managing rates struggling - US Treasury Secretary
Updates with comments for Asia morning session trade
By Ishaan Arora
Nov 26 (Reuters) - Gold climbed a near two-week high on Wednesday, after new U.S. economic data bolstered expectations of an interest rate cut by the Federal Reserve in December and weighed on the dollar.
Spot gold XAU= rose 0.8% to $4,161.10 per ounce, as of 0241 GMT, its highest since November 14. U.S. gold futures GCcv1 for December delivery fell 0.5% to $4,159.00 per ounce.
"Expectations are now being shaped more towards a December rate cut occurring...the case for which has been strengthened by a chorus of dovish remarks from Fed officials and benign economic data, which is boosting gold from a yield perspective," said KCM Trade Chief Market Analyst Tim Waterer.
Data showed Tuesday that U.S. retail sales increased less than expected in September, and in the 12 months through September, the Producer Price Index increased 2.7% after advancing by the same margin in August.
The data came on the heels of recent dovish remarks from Fed policymakers.
The dollar touched a one-week low as investors wagered that the leading candidate for the next Fed chair may guide policy in a more dovish direction, making greenback-priced bullion less expensive for other currency holders. USD/
The benchmark 10-year Treasury yields US10YT=RR held near one-month lows hit in the previous session. US/
Meanwhile, U.S. Treasury Secretary Scott Bessent said on Tuesday the Fed's system of managing interest rates is struggling and needs to be simplified.
Markets are pricing in an 84% chance of a Fed rate cut in December, compared to 50% last week, according to CME FedWatch tool data. FEDWATCH
Gold, a non-yielding asset, tends to perform well in low-interest-rate environments.
The U.S. weekly jobless claims report is scheduled for release later on Wednesday.
Elsewhere, top consumer China's net gold imports via Hong Kong in October fell about 64% from September.
Among other metals, spot silver XAG= rose 1% to $51.87 per ounce, platinum XPT= lost 0.2% to $1,550.40, and palladium XPD= was down 0.5% to $1,390.66.
(Reporting by Ishaan Arora in Bengaluru; Editing by Rashmi Aich)
((Ishaan.Arora@thomsonreuters.com))
