Inflation Fears Weigh on Gold Prices Ahead of US CPI Report

Gold prices fell in early London trade after last week's negative close. The US Labour Day holiday has delayed key data releases, but investors remain focused on inflation data and its impact on interest rates.

The stronger-than-expected jobs report has underscored concerns that inflation might be more persistent than hoped, potentially leading the Fed to raise rates. The upcoming US CPI report is pivotal for financial markets, with a hotter-than-anticipated reading cementing expectations for a September rate hike and exerting pressure on gold prices.

From a technical analysis perspective, gold's recent price action remains uncertain due to volatile movements. Key levels to watch include $4,310, previously broken but quickly reclaimed, and resistance at $4,500, which was a previous support and resistance level.