Gold Prices Soar Amid Rising Hopes for Lower Inflation
Gold prices rose more than 1% on Wednesday as investors awaited pivotal US inflation data that may shed light on the Federal Reserve's future policy path. Spot gold was up 1.1% at $4,414.63 per ounce by 0918 GMT.
The metal climbed to its highest since June 5 on Tuesday but retreated after facing resistance at its 100-day moving average near $4,387 an ounce. It's only the second time this month that gold ended lower.
UBS analyst Giovanni Staunovo said, 'Following weaker US payrolls, the focus is on US inflation.' A lower print would see the market pricing out further US rate cuts and support the gold price, but high US gasoline prices may cap the upside in the near term.
The CME FedWatch Tool shows traders now pricing in a 50% chance of a hike in September, down from 60% before the jobs report. The US consumer price index data due later today could alter interest rate expectations.