Gold sits at 2-1/2 week tops, closer to $1300 mark ahead of key US macro data

Gold extended its recovery move from near two-month lows, touched last Friday, and was seen inching back closer to the $1300 handle. 

The precious metal rose for the sixth consecutive session on Friday and remained supported by a mildly weaker tone around the US Dollar, despite upbeat incoming US economic data. 

The latest FOMC meeting minutes revealed policymakers' concerns over low inflation trajectory was seen putting pressure on the greenback and eventually benefitting dollar-denominated commodities - like gold.

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However, data released on Thursday indicated underlying strength in wholesale inflation. Hence, investors now look forward to the key US consumer inflation data in order to gauge the likelihood of gradual Fed rate tightening cycle. 

Should today's headline CPI print confirm that the inflation is indeed rising faster,  it would revive hopes for additional Fed rate hike moves, even beyond December meeting, and weigh heavily on the non-yielding yellow metal.

Today's US economic docket also features the release of monthly retail sales data, which should also a key role in determining the next leg of directional move for the commodity.

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Technical levels to watch

On a sustained move beyond $1300 mark, the metal is likely to dart towards the $1308-10 region en-route its next hurdle near $1315 area. On the flip side, immediate support is pegged near $1293 level, below which the commodity could skid back to $1286-84 horizontal support ahead of $1281 level.