Gold Surges Past $4,400 as Dollar Weakened and Fed Hike Expectations Fade

Gold prices have been rising steadily, with the metal now trading near $4,400 per ounce. This marks a significant breakout from its long consolidation range, with gold up around 8.7% this month. The rally is supported by a weaker dollar, falling expectations of a September Fed rate hike, renewed ETF buying, and continued central-bank and Chinese demand.

Vedika Narvekar, Research Analyst at Anand Rathi Shares and Stock Brokers, notes that gold now has support from both fundamentals and fresh investor money, making the recent breakout look more convincing than earlier attempts. Global gold ETF holdings added 22 tonnes in the week ended August 7, while China's central bank extended its buying streak to 21 months, adding around 640,000 ounces in July.

The key trigger this week is the US CPI data, which is expected at around 3.4% YoY. A softer number could further support gold, while a hotter print could revive Fed-hike bets. On the technical front, $4,400 is the key hurdle for the rally to continue, with $4,200 as strong support.