The XAUUSD price surged past the $2400 mark following the release of lower-than-expected CPI data and higher-than-expected unemployment claims. Gold has since consolidated within the range of $2406 to $2420. Should the price break above the $2420 level, the next target range would be $2435 to $2450.
The June Consumer Price Index (CPI) report, released on Thursday, showed a significant cooling of inflation, increasing the likelihood that the Federal Reserve could implement multiple interest rate cuts before the end of the year, according to experts.
In June, prices fell for the first time in nearly two years. The headline CPI declined by 0.1% month-over-month, marking the first decrease in 23 months, as reported by the U.S. Bureau of Labor Statistics. Economists had forecasted a 0.1% increase compared to May. Annually, CPI rose by 3.0% in June, down from 3.4% in the previous month, and better than the estimated 3.1% increase.
Core CPI, which excludes the volatile food and energy sectors, also surprised to the downside, increasing by just 0.1% in June compared to the previous month. Forecasts had predicted a 0.2% rise.
The unexpected decline in CPI, coupled with the rise in unemployment claims, has bolstered gold prices, pushing XAUUSD above the $2400 level and setting the stage for potential further gains.
By carefully monitoring these economic indicators, traders and investors can better understand the factors influencing gold prices and make informed decisions in the dynamic market environment.
Summary:
Gold prices broke above $2400 as the latest CPI data showed lower-than-expected inflation, and unemployment claims were higher than anticipated. The XAUUSD consolidated between $2406 and $2420. A breakout above $2420 could target $2435 - $2450. The decline in inflation and rise in unemployment claims suggest potential rate cuts by the Federal Reserve, fueling the gold price surge.