Gold prices sink below $1,950 as CPI data looms
Investing.com-- Gold prices fell below key levels in Asian trade on Tuesday, as traders pivoted into the dollar before U.S. inflation data due later in the day, which is widely expected to determine the path of interest rates.
The yellow metal saw a heavy degree of profit taking in the past two weeks, which pushed prices to an over three-week low as the prospect of higher-for-longer U.S. rates dampened gold’s outlook.
Spot gold fell 0.1% to $1,944.71 an ounce, while gold futures expiring in December fell 0.1% to $1,948.25 an ounce by 00:32 ET (05:32 GMT).
Gold prices were pressured by strength in the dollar and Treasury yields as markets kept chiefly to rate-sensitive assets before key consumer price index inflation data due later in the day.
The reading is expected to show some cooling in inflation through October, after inflation rose past expectations for the past two months. The reading also comes shortly after a string of Federal Reserve officials warned that sticky inflation could give the bank more impetus to raise interest rates further.
Higher-for-longer rates are expected to pressure gold, given that they increase the opportunity cost of investing in bullion. This trade battered gold over the past year, and has also kept its outlook largely uncertain.
Still, expectations of a slowdown in the global economy have kept alive some bidders for the yellow metal. Data due later in the day is expected to show the euro zone entering a technical recession in the third quarter.
The ongoing Israel-Hamas war is also expected to feed some safe haven demand for gold, although traders began pricing in a much lower risk premium on the yellow metal over the past two weeks.
Among industrial metals, copper prices fell on
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