Gold could benefit as Fed cuts rates in summer

Gold prices moved higher this week as the U.S. core PCE index for April showed slowing inflation, according to Jinshi. Swap traders predict that the Fed will cut interest rates at least once this year. Bart Melek, global head of commodity strategy at TD Securities, believes that this is in line with economists' expectations and confirms the Fed's assumption that U.S. inflation pressures are easing.

"The weakness in personal spending leads me to believe that the Fed has a chance to cut interest rates in the summer," Melek said. "This could attract speculative money into gold and silver, which, combined with the strong interest in gold in the Asian market, could be a major boon for the precious metal."