More US inflation data gave the dollar a shove lower and boosted gold, says Chris Beauchamp, Chief Market Analyst at online trading platform IG.
US factory-gate inflation helps support sentiment
Yesterday’s consumer price inflation failed to lift markets but the buyers are trying again in the wake of the PPI data, which has followed a similar pattern. A calmer tone also prevails after last night’s mini-panic over fears of an immediate attack on Iran by Israel, though nervousness will persist around this issue for the time being. With inflation data out of the way, earnings season wrapped up and a ‘no change’ from the Fed expected next week, investors would do well to remember the adage ‘never short a quiet market’.
Gold higher on geopolitical fears
Tariff uncertainty has taken back seat to war fears as the main driver of upside in gold. The price is testing the $3400 area again, a level that has marked the extent of upside over the past two months. Renewed USD weakness always helps of course, and since inflation still looks contained there is reason to expect further falls for the greenback ahead of next week’s likely-uneventful Fed meeting.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
Recommended Content
Editors’ Picks
Bitcoin sits at new record highs above $122,000
Bitcoin breaks above the key milestone level on Monday, setting a new all-time high above $122,000, with no signs of slowing. The technical outlook supports further gains as momentum indicators remain robust and price action firmly in price discovery mode, with the next potential target above $130,000.
EUR/USD flirts with daily lows near 1.1650
EUR/USD eased to the mid-1.1600s on Monday amid increasing selling pressure on the risk-associated universe. The pair’s daily pullback comes in tandem with a later rebound in the US Dollar, which remains underpinned by increased concerns about a US-EU trade war, particularly after US President Trump proposed 30% tariffs on the EU starting August 1.
Gold battling around $3,350 amid fresh tariffs’ threats
Gold prices maintain their bearish tilt around the $3,350 zone per troy ounce, leaving behind three consecutive days of gains. Fresh trade concerns seem to temper the precious metal’s decline, but investors remain cautious ahead of the publication of US inflation data on Tuesday and the US Dollar's continued strong tone.
GBP/USD: Extra weakness targets 1.3400
GBP/USD resumes its bad performance, dropping back to three-week lows and threatening to test critical support around 1.3400, as investors remain cautious amid increased trade effervescence, a stronger Greenback, and UK budgetary concerns.
Five fundamentals for the week: Investors eye tariff circus and US inflation data Premium
Which country will be the next to receive a letter from America? US President Donald Trump has been extending his tariff threats through the weekend. Has the US economy felt the consequences of levies already imposed? These are the topics for another hot summer month.
Best Brokers for EUR/USD Trading
SPONSORED Discover the top brokers for trading EUR/USD in 2025. Our list features brokers with competitive spreads, fast execution, and powerful platforms. Whether you're a beginner or an expert, find the right partner to navigate the dynamic Forex market.