Gold Prices Surge to Two-Month High on Cooling US Inflation

Gold prices have surged to a two-month high after US inflation cooled in July. The Consumer Price Index (CPI) rose 3.4% over the past 12 months, down from June's 3.5%. This marks the second consecutive month of year-over-year inflation easing.

The data is in line with economists' expectations and has reduced the likelihood of an immediate interest rate hike by the Federal Reserve, further boosting gold's appeal. Spot gold rose 0.6% to $4,433.62 per ounce earlier today after hitting its highest since June 5 earlier this week.

Market expectations have shifted in light of the new data, with traders now pricing in a 40% chance of an interest rate hike at the Fed's September meeting, down from about 54% a week ago.