Gold extends its current rebound from a multi-month low to a two-week high.
During the Asian session on Thursday, the gold price (XAUUSD) rose to a new two-week high, appearing prepared to extend its current strong recovery move from the $1,810 region, or a seven-month low reached last week.
Geopolitical uncertainties, falling bond rates, and a weaker US dollar continue to strengthen the Gold.
Tensions in the Middle East rise, the precious metal has reclaimed its role as a preferred safe haven and is attracting new investors. Geopolitical concerns and a dovish Fed continue to bolster the price.
The tension between Israel and the Palestinian Islamist party Hamas is still driving refuge flows to the gold price.
Officials at the Federal Reserve stated that the current spike in Treasury rates may make additional rate hikes unnecessary.
Fed Governor Christopher Waller stated on Wednesday that increased market interest rates may allow policymakers to “wait and see.”
The US PPI rose more than predicted in September, although underlying inflationary pressures remained low.
Investors appear to believe that the Fed is reaching the conclusion of its policy tightening cycle and that interest rates have reached their high.
The yield on the benchmark 10-year US Treasury note fell further from the highest level since 2007.
The US Dollar is moving away from the 11-month high and appears to be another reason supporting the XAUUSD.
According to the minutes of the September FOMC meeting, the majority of Fed members supported another rate rise.
The US CPI report might provide new clues regarding the Fed’s rate-hike path, as well as some motivation.
Market traders are now looking for clues about the Fed’s future rate-hike course in the latest US consumer inflation statistics.
The headline CPI is estimated to have slowed to 0.3% in September, with the annual rate falling to 3.6%.
The more closely monitored Core CPI is expected to have remained stable at 0.3% monthly and came in at 4.1% year on year.
The critical CPI report will impact the Fed’s next policy action and give the commodities with a new directional move.
