Gold stabilizes above $1,850 on weaker USD

Gold price has exhibited a minor correction after recording a high around $1,856.00 on Tuesday, but strongly stabilized above the crucial resistance of $1,850.00 as the US dollar index slipped sharply.

The precious metal has been advancing higher gradually after hitting a low of $1,837.06 and is expected to extend gains if the bright metal oversteps Tuesday’s high at $1,855.64.

The USD gave up the majority of its gains recorded on Tuesday after failing to cross the critical barrier of 102.83. A rebound in the risk-on impulse after investors ignored the uncertainty ahead of the US inflation strengthened the risk-perceived currencies and the precious metal. The US Consumer Price Index is expected to remain unchanged at 8.3% while the core CPI that doesn’t include food and energy prices may slip to 5.9% vs. the prior print of 6.2%.

The sustainability of the US inflation above 8% is going to put forward complications for the Federal Reserve (Fed). The Fed is going to dictate its monetary policy next week and elevated inflation along with the upbeat US NFP will compel a rate hike decision.