Gold Holds Steady but Heads for Monthly Drop Ahead of Crucial US Inflation Gauge
Gold prices held steady on Wednesday but remained on track to record a monthly loss as investor appetite waned amid expectations of elevated interest rates. Traders are closely watching upcoming U.S. inflation data for fresh clues regarding the Federal Reserve’s next monetary policy move.
Spot gold was virtually flat at $4,180.30 per ounce by 04:35 GMT, having shed roughly 6% since the start of September. U.S. gold futures edged up 0.8% to trade at $4,212.70 per ounce.
Meanwhile, the U.S. dollar is poised to notch a monthly gain, placing downward pressure on greenback-denominated bullion by making it more expensive for overseas buyers.
PCE Inflation Data in Focus
Markets are bracing for the release of the U.S. Personal Consumption Expenditures (PCE) price index—the Federal Reserve’s preferred inflation metric—scheduled for release at 12:30 GMT. The print is anticipated to heavily influence interest rate trajectories, U.S. Treasury yields, and currency valuation.
Key Technical and Macro Levels
Tony Sage, CEO of Critical Metals, noted that the PCE release represents a critical litmus test for gold, given its direct bearing on Federal Reserve policy expectations, Treasury yields, and the U.S. dollar.
Sage pointed out that a softer-than-expected reading could reignite bullish momentum for the precious metal, paving the way for a recovery back into the $4,200 to $4,300 range. Conversely, an unexpectedly hot inflation print could lift the dollar and bond yields higher, renewing downward pressure on gold and testing key support around the $4,100 per ounce threshold.