Gold futures are experiencing a sharp slump, dropping nearly 3% during today's session. The drop in the precious metal is the direct result of two overlapping impulses: a sharp escalation in expectations regarding the Federal Reserve and a decline in the war premium following Donald Trump's conciliatory remarks on the Middle East.
The main driver of the sell-off was a hotter-than-expected US CPI inflation reading, where the core rate rose by 0.3% month-over-month. The report immediately prompted a hawkish reaction from Fed officials. Policymakers delivered clear signals that, to protect central bank credibility, a more decisive pace of policy tightening may be necessary, and an option for a December interest rate hike of as much as 50 basis points instead of the standard 25 bps appeared on the table.
Debt markets reacted strongly, with the 2-year US bond yield surging by 19 basis points to 4.75%, marking its sharpest single-day jump in months. Concurrently, the dollar gained against all major currencies. Faced with the prospect of aggressive Fed moves and fading fears of conflict escalation, capital is leaving the precious metals market without hesitation in favor of safe, high-yielding debt.
After rebounding from around the low near $3,870, gold bounced directly off the resistance defined by the 50-day moving average (50 EMA near $4,142). Remaining below the cluster of the 50, 100, and 200 EMAs (the 4,140–4,260 area) reinforces the medium-term downward trend and threatens a retest of the psychological $4,000 level and the November lows.
Source: xStation5
US OPEN: Higher CPI Inflation Cools Sentiment, Anthropic Targets $1.4 Trillion Valuation
Hot CPI boosts Fed hike chances
Anthropic Debut Price. Does One Trillion Dollars Sound Reasonable?
Anthropic presses ahead with IPO as tech rally pauses
This content has been created by XTB S.A. This service is provided by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, entered in the register of entrepreneurs of the National Court Register (Krajowy Rejestr Sądowy) conducted by District Court for the Capital City of Warsaw, XII Commercial Division of the National Court Register under KRS number 0000217580, REGON number 015803782 and Tax Identification Number (NIP) 527-24-43-955, with the fully paid up share capital in the amount of PLN 5.869.181,75. XTB S.A. conducts brokerage activities on the basis of the license granted by Polish Securities and Exchange Commission on 8th November 2005 No. DDM-M-4021-57-1/2005 and is supervised by Polish Supervision Authority.