Gold Falls as Dollar Pressures Return
Gold prices weakened again during Thursday's trading (August 13), dropping below the US$4,400 per troy ounce level after previously touching the US$4,450 area—a high not seen since June 5. Pressure mounted ahead of the European session as the US dollar strengthened once more.
Positive sentiment stemming from US inflation data began to wane. July's CPI had previously eased to 3.4% year-on-year from 3.5%, while Core CPI rose 0.2% month-on-month and 2.5% year-on-year, aligning with market forecasts.
The data actually provided the Federal Reserve with room to hold interest rates steady in September, particularly following an earlier Non-Farm Payrolls (NFP) report that indicated a softening labor market. These conditions had previously driven gold prices up as expectations for near-term rate hikes diminished.
However, inflation concerns resurfaced due to persistently high and volatile oil prices. The market assesses that energy-related pressures could reignite inflation in the coming months, keeping the possibility of at least one Fed rate hike in 2026 on the table.
Geopolitical tensions between the US and Iran also had a mixed impact on gold. While conflict risks would typically bolster safe-haven demand, the US dollar simultaneously attracted defensive capital flows. This dollar strength capped gold's ability to sustain gains around the US$4,450 level.
Newsmaker Analysis: Gold's failure to hold the US$4,400 level suggests the market has begun profit-taking following the post-CPI rally. As long as the dollar and yields continue to strengthen, gold risks testing the US$4,370–US$4,350 range. Nevertheless, the fundamental structure is not yet entirely bearish; controlled CPI and a softening labor market continue to support the likelihood of the Fed holding rates steady. Attention now shifts to US PPI data, which could determine whether gold breaks back above US$4,400 or extends its correction. (asd)
Source: Newsmaker.id
