Rising Energy Costs May Push Gold Toward $4,160 Support Level

Gold prices remain volatile following the release of inflation data that shows rising energy costs and strong producer inflation. This has created fresh concerns about the inflation outlook, which could keep the Federal Reserve (Fed) hawkish and support Treasury yields.

The surge in oil and diesel prices may pressure gold in the short term. According to some analysts, if oil prices continue to rise, gold could test $4,160 or lower. However, central bank buying continues to support gold's long-term outlook.

In terms of technical levels, a break below $4,270 could expose the $4,160 support level. This is a key area for traders to watch as it could determine the next move in gold prices.