Gold Daily | Spot Gold Climbs 0.6% on Fed Rate Cut Speculation Amid Weak US Inflation and Dollar

【Latest Gold Price and Recent Trends】

Spot gold has risen 0.6%, standing above $3360, recovering from Monday's plunge due to soft US inflation data, boosting expectations for a Fed rate cut in September, supported by a weaker dollar.

【Technical Analysis】

Gold struggles to break the $3350/oz barrier, showing bearish outlook in the 4-hour chart. RSI is below midline, around 41.50, and 21-period SMA crosses 50-period SMA downward, indicating a bearish crossover. A sustained drop below the 200-period SMA at $3346/oz might trigger a decline towards $3300/oz, with sellers eyeing August's low of $3274/oz.

【Market Sentiment and Economic Background】

The US CPI data reinforced the possibility of the Fed adopting a more dovish stance in September amid political pressures and Trump's calls for rate cuts. The Treasury Secretary's comments suggest considering a 50 basis points cut. The Fed's next meeting is scheduled for September 17, with silence period starting September 7. The market has priced in a 60 basis points total rate cut by year-end, limiting further dovish expectations unless consecutive cuts are more certain.

【Analyst Opinions】

Giovanni Staunovo of UBS noted market discussions on a potential 50 basis points cut in September, focusing on upcoming weaker US economic data to support such moves. Most voting Fed officials support a September rate cut, with the probability likely staying around 50% without surprisingly strong NFP report data. Market attention focuses on Fed Chair Powell's speech at the Jackson Hole summit, likely reiterating decisions based on comprehensive data.