Gold is retracing some of the steep losses it suffered earlier this week, after bond yields plunged on weak U.S. economic data that raised bets on further Federal Reserve interest rate cuts.

Bullion edged up to trade near $3,245 an ounce, following a 2% gain on Thursday boosted by a report showing U.S. producer prices unexpectedly fell by the most in five years, while separate data showed retail sales barely rose.

Treasury yields fell on signs of waning economic activity and fading inflation, raising expectations for monetary easing. Lower borrowing costs and yields tend to benefit non-interest-bearing bullion.

The precious metal remains on track for a weekly decline of more than 2% and is about $250 below an all-time peak set last month.

The metal has lost some support as a safe-haven asset as easing tensions between the U.S. and China have boosted risk sentiment this week. Still, bullion is up more than a fifth this year, driven by a rebound in demand for bullion-backed ETFs, strong central bank buying and speculative demand in China.

Read More: Dimon Says Recession Still Possible Amid Tariff Impact Spot gold rose 0.2% to $3,244.88 an ounce as of 7:21 a.m. in Singapore. The Bloomberg Dollar Spot Index was steady. Silver and palladium were little changed, while platinum edged higher. In prepared remarks on Thursday, Fed Governor Michael Barr said the U.S. economy is in a strong position but warned that tariff-related supply chain disruptions could lead to lower growth and higher inflation. (Newsmaker23)

Source: Bloomberg