Gold Soars as US Inflation Data Reduces Fed Rate Hike Pressure

Gold prices have surged by over 1.5% and remain close to their highest levels in about two months following the release of the July US CPI report, which came in line with expectations.

The data showed headline CPI rose 0.1% month-over-month and 3.4% year-over-year, while core inflation stood at 0.2% month-over-month and 2.5% year-over-year.

The absence of an upside inflation surprise is supportive for precious metals as it reduces pressure on the Federal Reserve to raise interest rates again in September.

Gold futures markets are pricing in a 60% probability that the Fed will leave rates unchanged in September, compared with just over 45% a week earlier.