Gold Slips From Its Highs as Traders Hold Their Breath for US Inflation Numbers
AT A GLANCE
- Spot gold fell 0.4% to $4,124.42 per ounce after rallying more than 1% on Monday
- US CPI data lands at 1330 GMT
- Traders see an 84% chance of a Fed rate hike in December
- Trump says he will hold off on new strikes against Iran for now
Profit-taking and a looming inflation report are keeping gold on a short leash.
Gold took a breather on Tuesday. Investors cashed in after Monday’s rally and turned their eyes to the US consumer price index, the next big clue on where the Fed is heading.
KEY DETAILS
As of 06:18 GMT, spot gold was down 0.4% at $4,124.42. US December gold futures rose 0.5% to $4,133.00.
Kyle Rodda, senior financial market analyst at Capital.com, called it “a bit of churn,” with prices easing back from highs hit during the US session.
On Monday, Trump said he plans to hold off on new military strikes against Iran for the time being, following appeals from regional countries, including Qatar’s prime minister. Oil fell again on Tuesday.
Richmond Fed President Tom Barkin said the central bank should move “with care” on inflation, which he called its greatest risk. He has no base case for December.
MARKET REACTION
Spot silver slid 0.3% to $53.22. Platinum held steady at $1,577.57, and palladium dropped 0.2% to $1,039.16.
WHY IT MATTERS
Higher rates make non-yielding gold less attractive. With an 84% chance of a December hike priced in, a hot CPI print could push gold lower. Rodda adds that falling oil and less conflict could help gold through the dollar, inflation and rate expectations.
WHAT TO WATCH
CPI comes first today. Producer price index data follows on Friday.
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Source: Reuters
