Gold Prices Cool Down as Investors Await US Inflation Data
Gold prices have cooled down after reaching a 2-month high of $4,434.84 per ounce on August 11, as investors await US inflation data to gauge the Federal Reserve's interest rate outlook.
The spot gold price decreased by 0.05% to $4,363.09 per ounce, while December gold futures contracts also rose by 0.05% to $4,421.97 per ounce.
Analysts attribute the improvement in cash flow into gold as a support for its recovery momentum, with prices surpassing the $4,400 mark indicating a more positive market sentiment after a long period of adjustment.
The focus is now on the US consumer price index (CPI) report due out on August 12, which is expected to provide clues about the Fed's monetary policy direction.
Lower-than-expected inflation data may lead to increased expectations of a less rigid interest rate environment, supporting gold prices. Conversely, higher-than-expected inflation could make the Fed more cautious with policy easing, putting pressure on gold.