Gold Prices Stabilize as Markets Eye Upcoming Inflation Data

Gold prices have stabilized around $4,400 per ounce in recent days following last Friday's surprisingly strong US labour market data. However, markets are now focused on upcoming US inflation data, which is seen as a decisive factor for the Federal Reserve's September interest rate decision.

Fed Governor Christopher Waller has confirmed that the inflation print will play a key role in the Fed's decision-making process. As such, there is still considerable scope for a correction in interest rate expectations if the inflation data surprises significantly on either side.

Currently, futures imply a roughly 60% probability of an interest rate hike, leaving room for a sharp repricing and potentially volatile week for gold prices.