Gold Soars to 2-Month High on Weaker Dollar Ahead of US Inflation Report

Gold prices surged over 1% on Wednesday, reaching its highest level since June 5, as investors await the release of the US Consumer Price Index (CPI) report. The metal rose to $4,416.29 per ounce, exceeding its 100-day moving average of $4,387.33.

The increase in gold prices was supported by a softer dollar and technicals, according to Marex analyst Edward Meir. 'The CPI data has been encouraging,' Meir said. 'It was higher than last month, but it was in line with estimates, along with a weaker dollar and technicals which have all helped gold piggyback on it.'

The US inflation reading matched expectations, bolstering bets that the Federal Reserve will keep rates on hold in September. The FedWatch Tool showed a 38% chance of an interest rate hike at the September meeting, down from 46% before the inflation data.