Gold shines post CPI reading, anticipated to continue shining

This year, gold has been doing well so far. In the upcoming quarters, economists anticipate that the precious metal will prolong its rise. Always shining gold with growth issues front and centre

Prices are anticipated to stay sensitive to changes in investor risk perception and interest rate forecasts in the near future. However, we believe that Gold’s surge has more room to run in the ensuing quarters.

First, as long as the prognosis for economic development is uncertain, more money will likely flow into safe haven assets. Second, we believe that the US dollar is likely to continue to decline. When the US dollar is weakening, gold prices tend to climb. Additionally, downside risks to the dollar have increased as a result of money market pricing of Federal Reserve rate reduction.

Following the announcement of US inflation data that revealed levels below forecasts, the price of gold skyrocketed. The price of one ounce of XAU/USD increased from $2,007 to $2,028, marking the highest point in six days. As of this writing, the price of gold is 2009.02.

The Consumer Price Index (CPI) climbed 0.1% MoM in March, below the 0.3% market consensus, according to the US Labor Department’s announcement on Wednesday. The yearly rate decreased from 6% to 5%, falling short of the 5.2% market average. In March, the Core rate increased by 0.4% as anticipated.

Following the release of the inflation data, the US dollar fell, with the DXY hitting weekly lows close to 101.50. US yields decreased at the same time. The yield on US ten-year bonds decreased from 3.44% to 3.37%. Futures on Wall Street dramatically increased.

Lower rates and increased risk appetite are driving up the price of gold. The Gold Index is moving with a strong bullish momentum and is aiming for the most recent top near $2,030.