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A 1.8% Rally In Gold On Monday Pushes Prices Near Record Peaks Amid Economic Uncertainty

BY Benzinga | ECONOMIC | 08/14/24 10:50 AM EDT
  • Gold prices have fluctuated significantly, influenced by U.S. economic data.
  • Recently, gold exhibited a strong bullish trend, spiking 1.8% on Monday.

Gold prices have seen significant fluctuations recently, mostly due to U.S. economic data that fell short of expectations.

The market reacted to disappointing inflation reports, and the release of the U.S. Producer Price Index (PPI), which also missed economists' forecasts, added to the volatility, causing gold prices to swing.

This highlights how sensitive gold prices are to economic indicators, as investors rely on these figures to assess the economy's health and predict the Federal Reserve's next actions.

Speculation is growing around the upcoming Consumer Price Index (CPI) data. Market participants are eagerly awaiting this report, hoping it will offer clearer insights into future inflation trends and impact the Fed's interest rate decisions.

A lower-than-expected CPI could strengthen the case for a rate cut, making gold more appealing as an investment in a lower interest rate environment.

Earlier this week, gold saw a strong bullish movement, rising 1.8% on Monday and nearing its all-time high from July 17. However, after an attempt to break that high on August 2, selling pressure pulled the price back down.

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This movement is significant because gold has mostly been trading sideways since April 12, with support at $2277 and resistance at $2483. For gold to confirm a continued upward trend, it needs to break above the $2483 resistance and maintain an upward path.

Such a breakout would be an important sign of gold's strength and could lead to new highs, reflecting broader economic trends and investor confidence in gold as a safe-haven asset.

After the closing bell on Tuesday, August 13, the commodity closed at $2466.50, trading down by 0.23%.

This article is from an unpaid external contributor. It does not represent Benzinga's reporting and has not been edited for content or accuracy.

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