Gold Doesn't Fear a Fed Rate-Hike Pause

Gold closed higher on Thursday, despite a CPI report and other data that convinced many inflation is not a problem and that the Federal Reserve will cease raising interest rates sooner rather than later.

But gold, which serves as a hedge against inflation, still found cause to rally. First, the dollar took a hit after the CPI report. The Fed's 20-month-long campaign to raise rates has provided key support to the greenback. Gold, which is priced in dollars, normally rises when the dollar drops, as it takes more money to buy the same amount of the precious metal.

Second, crude oil prices, which gold has been tracking recently, jumped $1.41, or 2.3%, to $63.58 per barrel after the U.S. launched its largest air attack in Iraq in three years. ...