Gold prices varied within a constrained range on Thursday, October 13, as market participants maintained their caution ahead of important U.S. inflation data that might influence the size of the Federal Reserve's next interest rate hike.
Gold spot GOLD was stable at $1,670.20 per ounce as of early this morning (02:45 GMT). The price of American gold futures GOLD fell by 0.1% to $1,676.50.
The appeal of bullion has decreased because the metal offers no income, while previously serving as a hedge against inflation as a result of dropping interest rates used to combat high costs.
"For a while, inflation will continue to be quite sticky, which will put gold under pressure. The price range for gold will be between $1,620 and $1,740 in the foreseeable future "ED&F Man Capital Markets analyst Edward Meir stated.
When released at 12:30 GMT, the U.S. Consumer Price Index data is expected to show a scorching 8.1% year-over-year increase in September, which might confirm market expectations for another significant rate hike from the Fed. (USCPNY=ECI)
According to ANZ, a stronger print would be bad for gold.
According to the minutes of the central bank's most recent policy meeting, which were released on Wednesday, Fed policymakers agreed that in order to reduce inflation, they would need to adopt a more restrictive policy stance and keep it for a while.
Because the Fed is still worried about inflation and is still quite hawkish, Meir continued, gold still appears weak on the charts and any price rally will only last a limited time.
On the physical level, the London Bullion Market Association declared on Wednesday that it wants to recognize businesses that collect and process gold that is extracted by small-scale miners in poor nations.
Participants in the market assessed any new COVID-19 infections that had been reported from China, the world's largest consumer of gold, which has put limits in place to stop the disease's spread in some areas.
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