Gold prices (XAU/USD) continued their upward trend for a third consecutive day on Thursday, surpassing the $2,380 mark during the early European session, although still falling short of the weekly peak. This increase is largely influenced by expectations that the US Federal Reserve will initiate a rate-cutting cycle as early as September, following comments from Fed Chair Jerome Powell that have pressured the US dollar.
Additionally, persistent central bank purchases, ongoing macroeconomic uncertainties, and geopolitical tensions are providing further support to gold prices. However, the prevailing risk-on sentiment in the market may limit any significant gains for gold, as traders are eagerly anticipating the upcoming US consumer inflation data.
The key Consumer Price Index (CPI) report will be pivotal in shaping expectations regarding the Fed’s monetary policy direction, potentially affecting demand for the US dollar and offering significant momentum for gold prices. Despite this, the overall market sentiment suggests that the trajectory for XAU/USD remains inclined toward the upside.
