Gold Sees Slight Pullback as Market Awaits US CPI
Gold prices edged lower during Tuesday's trading (Aug 11) but remained near a more-than-two-month high. Spot gold fell approximately 0.3% to US$4,376.31 per troy ounce, having previously touched US$4,434.84—its highest level since June 5.
Gold briefly attempted to break through the 100-day moving average, which sits around US$4,387.92. Meanwhile, US gold futures closed up about 0.5% at US$4,441.10, indicating that buying interest remains robust despite growing market caution.
Investor focus has now shifted to US inflation data. The CPI is set for release on Wednesday, followed by the PPI on Thursday. The market is keen to see if inflationary pressures are truly coming under control, following weak July labor data that previously dampened expectations for Federal Reserve rate hikes and drove gold up 2.4% in a single session.
Nevertheless, the possibility of rate hikes has not been entirely ruled out. Markets still price in a roughly 50% chance of a rate hike in September and about 79% in December. Cleveland Fed President Beth Hammack has also suggested that gradual rate hikes might be necessary to prevent inflation from rising again.
On the geopolitical front, US-Iran tensions continue to bolster safe-haven sentiment. President Donald Trump has renewed demands on Tehran regarding peace negotiations, while oil prices remain near one-week highs. These conditions keep the risk of energy-driven inflation elevated.
Newsmaker Analysis: Gold continues to exhibit a bullish structure following last week's strong rally, though the US$4,388–US$4,435 range serves as a critical resistance zone. Should the CPI come in lower than expected, the likelihood of gold breaking through this area will increase significantly. Conversely, a hotter-than-expected CPI could drive up yields and the dollar, thereby triggering a correction back toward the US$4,350–US$4,360 range.
Source: Newsmaker.id
