Gold Prices Plummet on US Inflation Data
US inflation data released on Wednesday (26/8) has pushed gold prices down by over 1% to USD 4,595.93 an ounce. The figures were broadly in line with expectations, which led market participants to raise their hopes for a rate hike by the Federal Reserve next month.
The Personal Consumption Expenditures (PCE) Price Index rose 3.7% in the 12 months through July, slightly above the 3.6% forecast by economists polled by Reuters. The data was released by the US Commerce Department's Bureau of Economic Analysis on Wednesday.
Peter Grant, vice-president and senior metals strategist at Zaner Metals, believes that gold's price action ahead of today's data release was just profit-taking. He added that prices are now consolidating within yesterday's trading range and that he sees the potential for gold to move back above USD 5,000 this year.