Gold prices rose in European trade on Friday for the second day, while moving in a positive zone and about to mark the third quarterly profit in a row as global easing measures gain momentum, while China buys large amounts of gold.

The gains came ahead of important US personal spending data, the Fed’s favorite inflation gauge, which will provide important clues on the future of US interest rates.

Prices

Gold prices rose 0.2% today to $2331.95 an ounce, with a session-low at $2319. 

On Thursday, gold prices rose 1.3%, the first profit in three days away from two-week lows at $2293 an ounce. 

Quarterly Trading

Gold prices are up 4.25% this quarter, about to mark the third quarterly profit in a row on strong haven demand and Chinese purchases. 

US Rates

The markets are pricing in a 64% chance of a Fed September interest rate cut, and a 76% chance of such a cut in November. 

US Data

The developments came ahead of important US personal spending data for May, which is considered the Fed’s favorite gauge for inflation.

The SPDR

Gold holdings at the SPDR Gold Trust remained flat yesterday at 829.05 tonnes, the lowest since June 14. 

Yen skidded in Asian trade on Friday to 38-year lows against the dollar, trading below 161 yen per dollar for the first time since 1986 and resuming losses despite warnings from Japanese authorities.  

Yen is about to mark the second quarterly loss in a row against the dollar due to the stark interest rate differences between Japan and the US.

The Japanese government appointed a new forex diplomat on Friday as the yen continued to sustain heavy losses, raising expectations the Bank of Japan will intervene any time now.

The yen is also hurt by the surge in US 10-year treasury yields ahead of US personal spending data for May.

The Price 

The USD/JPY pair rose 0.35% today to 161.28, the highest since 1986.

The yen rose 0.1% against the dollar on Thursday, the first profit in three days on limited short-covering after falling below 160 the day earlier. 

Quarterly Trades 

The yen is down 6.5% so far against the dollar this quarter, heading for the second quarterly loss in a row.

The losses are due to concerns about the large interest rate gap between Japan and the US, which continues to underpin the dollar’s standing. 

Japan’s finance minister Shinuchi Suzuki issued another warning that authorities will take necessary measures in the forex market after yen hit a 38-year low against the dollar.

He said that the government aims to stabilize the exchange rate, and is concerned about the impact of volatility on the economy. 

Will the BOJ Intervene Once More? 

Data by the Japanese financial ministry showed authorities spent 9.79 trillion yen ($62.23 billion) to intervene in the forex market and support the yen. 

The data confirmed the doubts that the Bank of Japan intervened in a two-stage process last month, selling up massive amounts of dollars in order to prop up the yen and snatch back from a 34-year low at 160.21.

It’s now a question whether the BOJ will intervene once more after the yen reached a new low of 160.78, the worst since 1986. 

New Forex Diplomat 

The Japanese government appointed a new forex diplomat the oversee the market as the yen sustains heavy losses against major rivals. 

US Yields

US 10-year treasury yields rose 1% on Friday, resuming gains and almost touching two-week highs at 4.347%, underpinning the greenback.

The developments came ahead of important US personal spending data for May, which is considered the Fed’s favorite gauge for inflation.

The markets are pricing in a 64% chance of a Fed September interest rate cut, and a 76% chance of such a cut in November. 

Wheat prices rose on Thursday after US exports data and reports that dedicated wheat fields in Canada were less than expected, indicating a reduced harvest.

New export data from the US Agriculture ministry also underpinned prices, after showing the US sold 667,173 metric tonnes in the week ending June 20, above the expected range of $200,000 to 600,000 tonnes. 

Otherwise, the Canadian government’s reports showed the dedicated wheat fields totalled 26.64 million hectares, down 1.1% from last year. 

Otherwise, the European Commission expects wheat inventories in the EU to fall to 13.1 million tonnes in the year 2024/25 from 13.5 million tonnes, as exports increased by 0.55 million tonnes to 31.65 million tonnes in May.

Corn 

Corn prices due in December closed 0.6% higher at $4.33 a bushel.

Soybeans 

Soybean November futures fell 0.2% to $11.04 a bushel.

Wheat

Wheat September futures surged 3.6% to $5.79 a bushel. 

Ethereum rose on Thursday following data and controversial remarks about the future of the Federal Reserve’s monetary policy. 

Government data showed US GDP growth rose 1.4% y/y in the first quarter in the final reading, up from 1.3% in the secondary reading. 

Data also showed unemployment claims fell by 6 thousand last week to 233 thousand, below estimates of 235 thousand. 

Atlanta Fed President Raphael Bostic said the GDP and labor data show a slowdown in activity, which means the demand and supply balance is restoring, which could drag inflation down. 

Bostic expects the Fed to cut interest rates in the second half of the year, and he also expects inflation to hit the 2% target in 2025. 

Tomorrow, important US data on personal sending will be released, which the Fed relies on to gauge inflation

Ethereum

Ethereum rose 2% on the Coinmarketcap platform as of 20:47 GMT to $3450.