US President Donald Trump’s recent tariff increases on Canada initially boosted gold prices but were later reversed in response to provincial adjustments. A narrowly passed spending bill in Congress also aims to prevent a government shutdown, enhancing market confidence.
Ukraine Russia Ceasefire Impact
Tensions regarding a possible ceasefire between Ukraine and Russia could influence global risk sentiment, potentially creating resistance for gold. Speculation persists that the Federal Reserve may resume rate cuts, with traders pricing in three cuts of 25 basis points by year-end.
Technically, gold may need to surpass the $2,928-2,930 range for further gains, with key resistance at about $2,956. Conversely, if prices drop below $2,900, support may occur near $2,880, with further declines possible towards $2,800.
The US CPI report, measuring inflation trends, plays a vital role in guiding the economy. The Fed aims for around 2% inflation YoY, amidst pressures from supply chain disturbances, leading to expectations of sustained aggressive monetary policy.
Impact Of US Inflation Data
Gold has been fairly steady as traders eye the upcoming US inflation figures, which might have a bearing on the Federal Reserve’s next moves. The expectation that interest rates could be trimmed multiple times this year, largely because of worries about economic growth, continues to underpin the appeal of gold as a safe asset. Even minor shifts in this sentiment could cause price fluctuations, making it necessary to monitor any revisions in the outlook for US monetary policy.
