Gold Surges to Two-Month High as US Inflation Data Fails to Spark Rate Hike Expectations

Gold prices surged to a two-month high on August 12 after the release of mild US inflation data. The Consumer Price Index for July rose just 0.1% month-on-month, in line with market expectations.

The moderate inflation reading and recent signs of weakness in the labor market have strengthened expectations that the Federal Reserve will hold interest rates steady at its September meeting.

This has made gold more attractive as an investment option, prompting capital to flow into this traditional safe-haven asset. The spot price broke above a key resistance level, reaching $4,141.24 per ounce before closing up 0.93% at $4,408.73.