Gold Prices Soar Ahead of Pivotal CPI Report

Gold prices have been steadily climbing over the past month, rising by nearly 11% to reach $4,443.70 per ounce, just shy of a two-month high.

The upcoming US consumer price index (CPI) report on August 12 will be closely watched as it could influence the Federal Reserve's interest rate decisions.

China's central bank has been aggressively accumulating gold reserves, adding around 20 tonnes in July and 15 tonnes in June, the largest monthly increases since October 2023.

This buying spree is not limited to China, with central banks globally replenishing their reserves at a rapid pace, and Chinese institutional investors also increasing their gold holdings as a hedge against market turbulence.

The recent decline in inflation expectations has led many analysts to abandon calls for a September rate hike, with the Fed now expected to pause rather than raise rates.