Gold Analysis 14-August-2024

Gold prices slightly declined to around $2,460 per ounce on Wednesday but stayed near record levels. This movement came after new signs of slowing US inflation raised hopes that the Federal Reserve might opt for a more significant interest rate cut in September.

Gold Analysis 14-August-2024

In July, annual producer inflation decreased to 2.2%, down from 2.7% in June, bringing the Fed’s target to 2%. Additionally, gold continues to attract investors due to its safe-haven status, especially given rising geopolitical tensions, including Iran’s expected response to Israel and Ukraine’s actions in Russia.

Investors are now awaiting the US Consumer Price Index (CPI) data, which could provide further insights into inflation trends. The CME FedWatch Tool indicates a 50% chance of a 50-basis-point rate cut in September. Lower interest rates generally increase the attractiveness of gold, which does not yield interest.