Gold Prices Rebound on Falling Yields, US Inflation Data

The Gold price has recovered from its daily lows to reclaim the 100-day Simple Moving Average (SMA) of $4,335, following the release of US inflation data. The US Consumer Price Index (CPI) rose by 0.4% MoM in August, with an annual increase of 3.4%, matching expectations. Core CPI went up 0.3%, slightly above forecasts, while remaining at 2.4% over the past year.

The data initially strengthened the Greenback, but its initial reaction faded even as money markets priced in a 91% chance of a rate hike by the Federal Reserve next week. The US Dollar Index (DXY) clings to 99.00, down just 0.05%, while the University of Michigan Consumer Sentiment for September fell from 51.7 to 47.8, missing forecasts.

Bullion prices stand firm, advancing steadily and capitalizing on falling US bond yields during the session. The US 10-year Treasury yield drops 1 basis point to 4.951%, despite surging over 16.5 basis points, or 3.49%, this week.