By Barani Krishnan

Investing.com – Whatever the fear salesman is doing, it isn’t hurting gold.

The yellow metal futures gained Friday and even advanced on the week. However, fears about a quicker-than-expected rate rise in the United States were amplified after the Consumer Price Index readings for November came in at the same level as October. It was already at its 40-year peak.

Gold is almost at risk from news of rate increases. Bullion traders seemed to be focused on the inflation story this time and allowed slide talk to suggest that the Federal Reserve would take action to rectify the situation.

U.S. gold futures’ most active contract, , settled Friday’s trade up $8.10, or 0.5%, at $1,784.80 an ounce. It rose 0.1% for the week.

“Gold is slowly getting its mojo back after a hot inflation report mostly matched estimates,” said Ed Moya of online trading platform OANDA. “A lot of the inflation is stickier than anyone wants and that should keep gold’s medium- and- long-term outlooks bullish.”

Moya cautioned, however that an accelerated rate hike cycle could be a risky and trigger panic selling of gold. However, there is still a good chance that the Fed will do that right now.

“Gold just needs to survive a firm consensus on how many rate hikes the Fed will start off with next year,” he said. “Gold’s recent trading range of $1,760 and $1,800 might continue to hold up leading into next week’s FOMC decision.”

Federal Open Market Committee of the Fed, also known as the FOMC (Federal Open Market Committee), decided in November to reduce the $120 million it spent on assets and bonds since March 2020’s Covid-19 epidemic. Jerome Powell (Federal Open Market Committee Chair) and other FOMC senior officers have stated that it is essential to reduce runaway inflation as an economy recovers from the Covid-19 pandemic.

For the purpose of determining the time frame for the initial post-pandemic rate rise, the Fed will be closely monitoring data such as employment and inflation. Since March 2020’s Covid-19 epidemic, the central bank has kept rates at 0.25% and zero respectively.

The US’s jobless claims fell to 184,000 in the last week as the economy recovered from the recession, Labor Department data revealed. The unemployment rate, meanwhile, stood at 4.2% in November — just 0.2% higher than the Fed’s classification for “maximum employment.”