Gold Price Forecast: XAUUSD to move back higher on soft US CPI

FXStreet Insights Team FXStreet

Gold fails to benefit from safe-haven flows amid gloomy demand outlook. Inflation data from the US will be watched closely by investors this week. A soft print could allow the yellow metal to stage a recovery, FXStreet’s Eren Sengezer report.

Difficult time finding a good enough reason to bet on a steady rebound

“On Wednesday, the BLS will release the Consumer Price Index (CPI) data for June. Markets expect annual CPI to edge higher to 8.7% from 8.6% in May. Core CPI, which excludes volatile food and energy prices, is forecast to decline to 5.9% from 6%. There is room for additional dollar strength in case inflation prints surpass analysts’ estimates. On the other hand, a soft inflation report should trigger a downward correction in the greenback and allow XAUUSD to stage a rebound.”

“Gold’s demand outlook is unlikely to improve in the near term and market participants are likely to refrain from committing to a risk rally.”

“In case inflation data from the US revive hopes of the Fed taking its foot off the gas pedal in the last quarter of the year, it wouldn’t be surprising to see XAUUSD reverse its direction but recovery attempts are likely to remain limited.”

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FXStreet Insights Team

FXStreet

The FXStreet Insights Team is a group of journalists that handpicks selected market observations published by renowned experts. The content includes notes by commercial as well as additional insights by internal and external analysts.

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