Gold Under Pressure as Strong US Inflation Supports Hawkish Fed Outlook

Gold remains under pressure after stronger-than-expected US inflation data increased expectations that the Federal Reserve may keep interest rates higher for longer. Rising Treasury yields and a stronger US dollar are reducing demand for non-yielding assets like gold, while renewed safe-haven demand for the dollar amid US-Iran tensions is adding further pressure on bullion.

Markets are now focused on upcoming US PPI data and the Trump-Xi meeting. A stronger PPI reading could strengthen the higher-for-longer Fed outlook, while any improvement in US-China relations may further weaken safe-haven demand for gold.

Technically, gold remains bearish after failing to break above key resistance near the 50-day SMA and falling trendline resistance. Support levels are seen near $4,650, followed by $4,500 . On the upside, a move above $4,765 would improve the outlook and could reopen the path toward the $4,890. level.

XAU/USD Daily Chart