Gold Prices Soar on Diminished Rate Hike Expectations
The spot gold price reached a two-month high on August 13th, rising 0.93% to $4,407.7 per ounce at 17:45 ET (21:45 GMT), according to Kitco.
This increase followed the release of US consumer inflation data for July, which showed a 0.1% rise in the consumer price index (CPI) from the previous month.
Analyst Edward Meir at Marex stated that the CPI data was encouraging, as it met market expectations and coupled with a weaker USD and technical factors, all supported gold prices.
The decrease in market expectations of a Fed interest rate hike in September also contributed to the rise in gold prices, with CME's FedWatch Tool showing traders now pricing in around a 40% chance of a rate hike at its September meeting, down from 46% before the inflation report was released.
However, experts warn that inflation developments, oil prices, and geopolitical tensions could still alter the outlook for gold prices in the near future.