Gold Price Stability at Risk Ahead of US CPI Report

Gold has maintained its upward momentum in recent times due to reduced inflation and Fed tightening risks following de-escalation in the Middle East. The hopes for a US-Iran deal have also contributed to this trend. However, market participants are cautious ahead of next week's US CPI report, which will be critical for the September FOMC decision and the Jackson Hole Symposium.

A hot CPI report could trigger a selloff in gold, with traders increasing rate hike bets. On the other hand, a soft report would reduce further the risk of Fed tightening and give gold another boost.

The US NFP report released today is unlikely to have a significant impact on the market, as the Fed's focus is not on the labor market. A slight miss or beat in the report should not change the big picture, but an increase in wage growth could give some traders second thoughts.