Gold prices (XAU/USD) have stayed steady this week after a strong two-day rise above $2,680 on Wednesday. This rally came after weaker-than-expected US Producer Price Index (PPI) data caused US bond yields to drop. Now, investors are waiting for the US Consumer Price Index (CPI) report, expected this Wednesday, which could push gold prices higher if it shows weaker inflation.
US CPI Report: Key Event This Week
The US CPI report for December is the highlight of this week. Following softer PPI data, analysts predict that both the headline and core CPI numbers will show slower growth. Additionally, speeches from Federal Reserve officials later on Wednesday may provide more clues about their policy plans.
Key Market Updates
- US 10-Year Yield: The US 10-year yield fell to 4.757% on Wednesday, down from a 14-month high of 4.802%.
- Federal Reserve Expectations: According to the CME FedWatch tool, the Federal Reserve is expected to keep rates unchanged until June 18. There’s a 43.6% chance of no changes and a 56.4% chance of lower rates.
- Upcoming Events:
- 13:30 GMT: December US CPI data release. Core CPI is expected to rise 0.2%, while headline CPI is expected to grow 0.3%.
- 14:00 GMT: Speech by Chicago Fed President Austan Goolsbee at the Wisconsin Bankers Association Economic Forecast Forum.
- 15:00 GMT: Minneapolis Fed President Neel Kashkari’s fireside chat at the Regional Economic Conditions Conference.
Technical Analysis: What to Expect
Gold prices are holding above key levels. Below that, the 100-day SMA at $2,638 provides another safety net. The ascending trend line at $2,618 is likely to stop further price drops.
On the upside, breaking the October 23 low of $2,708 could open the way toward the all-time high of $2,790. The CPI report could spark big movements in the gold market.
Conclusion: Keep an Eye on Key Events
The upcoming US CPI report is expected to influence gold prices. Be prepared for potential volatility and watch key price levels. For expert insights and gold market updates, visit Daily Gold Signal. For more detailed updates, check out the Daily Gold Update section.
