Gold rises above $4,400 as US inflation data takes centre stage
Gold (XAU/USD) rebounds on Wednesday after closing in negative territory on Tuesday for only the second time in six trading days. Traders now await the US Consumer Price Index (CPI) data, due at 12:30 GMT, to see whether the bullish momentum will continue or a reversal will take shape.
Gold prices surged past the $4,400 mark on Wednesday, as traders analyzed US inflation data that fell within expectations. The headline Consumer Price Index (CPI) rose by 0.1% in July, after a decline of 0.4% in June, with the annual rate easing to 3.4% from 3.5%. The Federal Reserve's policy remained restrictive, as the probability of a September rate hike decreased to 38% from 44%.
The yellow metal was buoyed by the weaker US Dollar and higher Energy prices, signaling a potential stagflationary theme. Gold's price action surpassed both the 50-day and 100-day Simple Moving Averages, hinting at a bullish trend, yet it neared the 200-day SMA barrier, which could lead to consolidation.
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