Gold price (XAU/USD) has been struggling to hold onto its recent gains, consolidating below a one-month peak. The price remains steady in neutral territory as traders await key economic data. The US Consumer Price Index (CPI) report, which showed inflation slowing, has raised expectations of a cautious approach from the Federal Reserve (Fed) regarding interest rate cuts. This has led to higher US Treasury yields, acting as a headwind for the non-yielding yellow metal.
However, geopolitical tensions, particularly from the Russia-Ukraine conflict and Middle East tensions, continue to support gold as a safe-haven asset. Additionally, concerns over US tariff policies and predictions of a third consecutive rate cut next week contribute to gold’s resilience. Despite a subdued US Dollar (USD), the gold price remains cautious.
Traders are now focused on upcoming US macroeconomic data, particularly the Producer Price Index (PPI) and Weekly Initial Jobless Claims, for short-term direction. The market’s attention remains firmly on the Federal Open Market Committee (FOMC) monetary policy decision on December 18.
Technical Outlook
Gold price has encountered resistance near $2,726, with immediate support around $2,700. Below this level, support zones around $2,675 may come into play. On the upside, a break above $2,735 could push the price toward $2,750, with further gains aiming towards the all-time high around $2,800
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