GOLD: Gold Consolidated and Pulled Back
The most striking development in global financial markets last week was undoubtedly the strong rebound in gold prices. Following the shock of U.S. July nonfarm payroll data falling far short of expectations, spot gold prices surged last Friday to a seven-week high, not only recording their largest weekly gain so far this year but also triggering a marked shift in market expectations regarding the Federal Reserve’s policy path. At the same time, subtle changes in the geopolitical situation in the Middle East provided further support for gold prices.
During early Asian trading on Monday (August 10), gold consolidated and pulled back, currently trading around $4,320.
This week, the market will see a series of key data releases, among which the U.S. Consumer Price Index (CPI) due out on Wednesday is undoubtedly the most important. If inflation data comes in higher than expected, the need for the Federal Reserve to maintain its hawkish stance will be reinforced once again, and gold may quickly face profit-taking; conversely, if inflation continues to ease, it will further solidify market expectations that the Fed will delay interest rate hikes, providing support for gold prices to test the $4,500 level or even higher. In addition, data such as U.S. retail sales, the Producer Price Index (PPI), and the University of Michigan Consumer Sentiment Index will also influence market assessments of economic momentum. $Gold - main 2612(GCmain)$$USD/XAU(USDXAU.FOREX)$
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