Inflation Fears Weigh on Gold as PCE Index Rises Above Expectations

The recent inflation data from the US has had a significant impact on the market, pushing gold prices down by about 1.3%.

The Personal Consumption Expenditures price index (PCE), which is the Federal Reserve's preferred inflation gauge, rose 0.2% in July and was 3.7% higher than a year earlier.

Economists had expected annual PCE inflation of about 3.6%, but the actual number came in above expectations.

The Fed pays particular attention to core PCE, which excludes food and energy prices, as it gives policymakers a clearer view of underlying inflation pressures.

Inflation has become a major concern for markets, with investors worried that it may keep interest rates elevated and push the dollar higher.