XAU/USD Price Update: Gold Aims for Record Highs as Market Digests CPI Data
- US CPI in line with expectations, but market turns risk-averse ahead of Fed rate decision
- Gold price peaks near record high, retreats after release of US CPI data
- Market anticipates Fed to trim interest rates by 25 bps, impacting XAU/USD price action
Gold price surged to $2,528.95, near its all-time high, before pulling back to $2,500 following the release of US CPI data. The August CPI rose by 2.5% YoY, slightly below expectations, leading to uncertainty about Fed rate cuts. Market sentiment turned cautious as investors await the Fed’s decision next week, with expectations of a 25 bps rate cut. Despite initial market jitters, XAU/USD reclaimed the $2,510 level as US indexes recovered some losses.
The focus now shifts to the European Central Bank’s upcoming monetary policy decision, where rate cuts are expected. Any deviation from the ECB’s usual stance could impact financial markets.
XAU/USD Technical Analysis
On the daily chart, XAU/USD remains bullish, trading above key SMAs with positive technical indicators. In the short term, the pair maintains a neutral-to-bullish stance, holding above support levels at $2,507.60, with resistance at $2,519.75 and potential for further upside towards $2,545.00.
Analysis: Gold price nears record highs as market reacts to US CPI data and Fed rate cut expectations. Investors should monitor upcoming central bank decisions for potential market impact.