Gold held above $1,900 an ounce on Thursday, hovering near its strongest levels in nine months on firm expectations that the US Federal Reserve will slow the pace of its interest rate hikes. Meanwhile, the metal came under pressure in the previous session amid hawkish remarks from Fed officials who backed further rate increases, though weaker-than-expected US retail sales and producer inflation data that fueled recession fears tempered rate hike concerns. Markets are currently expecting the US central bank to downshift to a smaller 25 basis point rate hike in February after delivering a half-percentage point increase in December. Elsewhere, consumer prices in the UK also fell for the second straight month in December, adding to further signs that inflationary pressures may have finally peaked. Gold is highly sensitive to the rates outlook as higher interest rates raise the opportunity cost of holding non-yielding bullion, and vice versa.
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