July 4, 2022

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Gold price update: US inflation casts a shadow over perspective

Gold Price Top: High Tension Following US Consumer Price Statistics

Before the US consumer prices are released, investors in the gold market are taking another step back. Investors fear that inflation in the United States has not fallen enough. So fears about interest rates have resurfaced. Investors were expected to pay about $ 1,845 per troy ounce of precious metal on Friday morning, down 0.15 percent from the previous day, according to an IG analysis.

Fear of interest rates is holding investors back

Fears of an interest rate hike have once again gripped the stock markets. Investors fear that the US Federal Reserve may tighten bad interest rates to control inflation faster than previously expected.

Most recently, the US currency watchdog forecast a further 50 basis points. However, if inflation grows stronger than expected, the XXL rate of 75 basis points may also be considered. The central bank has already raised interest rates twice this year. Currently, the interest rate is 0.75-1.00 percent.

ECB reverses interest rates in eurozone – first rate hikes planned for July and September

The turnaround in interest rates in Europe yesterday will add further burden. The ECB wants to raise interest rates for the first time in more than ten years. At the same time, the zero interest policy will be dropped. A total of 25 basic point steps are guaranteed for the months of July and September.

Gold Price: This may continue

A sharp rise in interest rates in the United States could put pressure on the price of gold. Investors should keep an eye on USD 1,800 and USD 1,880. The recent reversal shows that markets are waiting for relevant news on US monetary policy.

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The future monetary policy of the ECB is also a matter of debate in the markets. Aside from the July 1 bond purchase expiration, further interest rate hikes on the part of the ECB may be a matter of time. However, the fundamental pace of the rate hike cycle remains decisive.

Version possibilities with Turbo 24

If one is on the selling side (ISIN DE000A236T50) and thinks the price of gold will fall in the future, IG Turbo certificates above $ 2,000 above the current chart resistance zone would be interesting. Alternatively, elegant traders (call) (ISIN DE000A2379R7) may want to keep track of exit levels below $ 1,800.