Gold Prices Tumble Amid Rising Inflation Bets

The price of gold has been impacted by recent inflation data from the US. The Consumer Price Index (CPI) release, due out soon, will be a key indicator for investors and the Federal Reserve.

A hot US Producer Price Index (PPI) reading led to increased bets on a September rate hike, which in turn boosted the dollar and put downward pressure on gold prices. The PPI rose 0.4% last month after an upwardly revised 0.1% gain in July.

The upcoming CPI release is expected to show annual core inflation at 2.4%, a slight slowdown from the previous month's 2.5%. A surprise upside in core prints could reinforce hawkish expectations, strengthening the dollar and sending gold lower.