■ Gold's direction remains unclear as Fed policy outlook keeps traders on Buy Monero with credit cardedge.
■ Safe-haven demand persists amid geopolitical tensions and market uncertainty.
■ All eyes turn to upcoming US economic data ahead of crucial FOMC meeting.
The precious metal faced renewed downward pressure Thursday following stronger-than-anticipated US producer price data, suggesting inflationary pressures may persist longer than expected. This development tempered expectations for imminent Federal Reserve rate reductions, boosting Treasury yields and the dollar while creating headwinds for non-interest-bearing assets like gold.
Market participants continue pricing in approximately 60% probability of June rate cuts according to CME FedWatch data, helping the yellow metal find support above the psychologically important $2,150 level. The metal traded with modest gains during Asian hours Friday as risk-off sentiment provided additional support, though price action remains confined within familiar territory.
Market Drivers: Conflicting Signals Keep Gold Range-Bound
February's PPI reading surprised to the upside at 1.6% year-over-year, exceeding both market forecasts and January's revised 1% increase. This hotter inflation print followed similarly unexpected strength in recent CPI data, potentially complicating the Fed's policy calculus.
Concurrently, weekly jobless claims unexpectedly declined to 209,000, contrasting with softer retail sales figures that suggested consumer spending may be slowing amid elevated prices and borrowing costs. These mixed signals have created uncertainty about the timing and magnitude of potential Fed easing.
Geopolitical developments added another layer of complexity as Russia reportedly moved tactical nuclear weapons closer to NATO territory, escalating tensions and supporting safe-haven demand. Traders now await Friday's manufacturing and consumer sentiment data for additional clues about the US economic trajectory.
Technical Perspective: Critical Support Holds the Line
The current consolidation phase follows gold's impressive rally earlier this month, with the $2,150-$2,152 zone emerging as crucial support. A decisive break below this area could open the door for a test of subsequent support near $2,128, with more substantial buying interest likely emerging around the $2,100 psychological level.
On the upside, resistance appears firm around $2,178-$2,180. A convincing move above this barrier could reignite bullish momentum toward last week's record highs near $2,195, with potential for extended gains upon clearing the $2,200 threshold. The metal's near-term trajectory may become clearer following next week's FOMC meeting and updated economic projections.
