Gold Falls Slightly Ahead of US CPI
Gold prices weakened in Thursday's Asian session, falling slightly below $4,350/oz. This movement was largely driven by profit-taking after gold had reached high levels in recent weeks, coupled with a strengthening US dollar.
The strengthening dollar makes gold less attractive in the very short term, as it is priced in USD. When the USD rises, gold typically feels more expensive for buyers outside the US, potentially temporarily softening demand.
Despite the decline, gold's downside is considered limited. Markets still hold expectations that the Fed will potentially continue to cut interest rates in the future, after the latest US employment data indicated the economy is starting to cool. Lower interest rates typically support gold, as the opportunity cost of holding non-interest-bearing bullion becomes lower.
Beyond interest rates, geopolitical tensions have also added a cushion to gold's favor. Venezuela is said to be deploying its fleet to escort oil vessels amid threats of a blockade from the US. Situations like these often trigger demand for safe-haven assets, so gold tends to remain sought after when risk increases. Today's main market focus is the November US inflation (CPI) release. The headline CPI figure is expected to be 3.1% YoY, while the core CPI is projected at 3.0% YoY. Additionally, US weekly jobless claims data will be released, which could influence the direction of the dollar, yields, and ultimately gold. (asd)
Source: Newsmaker.id
