Inflation Data and the Cancellation of the US-Ukraine Agreement Could Make Gold Rise Again
Last week contained many stories that had an impact on today's gold price, as evidenced by the fairly large gap at the opening of gold this morning. Inflation data showing an increase in US inflation and the cancellation of the rare earth mineral agreement between the US and Ukraine were the triggers.
The plan to sign an important mineral agreement between the US and Ukraine was canceled after Donald Trump's meeting with Volodymyr Zelenskiy could be said to have failed completely after the Ukrainian president doubted that the efforts being made by the US President would become a solid peace agreement.
Trump said "He disrespected the United States in his beloved Oval Office. He can come back when he is ready for Peace," Trump said in a social media post shortly before Zelenskiy's departure. The Ukrainian leader angered Trump and US Vice President JD Vance when he said he did not believe the proposed deal would be enough to deter further Russian aggression.
Meanwhile, in other US economic news, the US Personal Consumption Expenditures (PCE) price index rose 0.3% month-on-month in January 2025, the same pace as in December, and in line with forecasts.
The two pieces of news were enough to prompt a positive response from Asian markets, which believe the current political turmoil in Russia and Ukraine will continue for a long time. On the other hand, inflation is also still rising in the US, which appears to be moving further away from the Fed's 2% target. Geopolitical turmoil and high inflation will provide a fertile environment for gold to grow.
Source: (mrv@Newsmaker)
