Gold retreats after hitting fresh 2-month highs, down little around $1285 level
|Having spiked to fresh two-month highs, gold retreated a bit and turned lower to snap three consecutive days of winning streak.
Intensifying war of words between the US and N. Korea continued stroking safe-haven buying and lifted the precious metal to its highest level in over two months during Asian session on Friday.
• US Defense Sec Mattis: Military is 'ready' to counter North Korea threat
However, a modest US Dollar recovery, which tends to weigh on dollar-denominated commodities - like gold, kept a lid on the further upside and might have prompted traders to take some profits off the table.
The pull-back, however, has been limited amid fading expectations of additional Fed rate hike action by the end of this year. Thursday's dismal US PPI print indicated stubbornly low inflationary pressure in the US. Hence, today's consumer inflation figures now hold the key to the Fed's next monetary policy action.
• US: CPI likely increased to 1.7% y/y in July – Danske Bank
This coupled with speeches from a couple of FOMC members - Dallas Fed President Robert Kaplan and Minneapolis Fed President Neel Kashkari, would now help investors to determine the next leg of directional move for the non-yielding metal.
Technical levels to watch
Immediate support is pegged near $1280 level, below which the metal is likely to extend the corrective slide towards $1274-73 horizontal zone en-route $1269-68 important support. On the flip side, bulls would be eyeing for a clear break through $1288-90 hurdle, which if conquered has the potential to lift the commodity towards the key $1300 psychological mark ahead of the next major hurdle near the $1308-09 region.
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