GOLD Holds Steady Despite Market Anxiety of US Inflation Data

Gold prices have dipped towards 1 ,990.00 as the US Dollar Index (DXY) makes gains. Despite this, investors remain optimistic about a potential rebound in US inflation figures, buoyed by solid labor market conditions.

While gold prices are declining towards an upward-sloping trendline plotted at 1 ,885.77, there is hope that Wednesday's US inflation data will provide further guidance. Although the headline Consumer Price Index (CPI) is expected to moderate due to lower gas prices in March, core inflation - which excludes oil and gas prices - may show a surprise upside as household earnings remain strong.

Although S&P500 futures have extended losses on fears of further rate hikes by the Federal Reserve (Fed), there is a general feeling of positivity within the market. Fed Chair Jerome Powell is expected to push rates above 5% in order to address persistent inflation, potentially leading to higher earnings for acquiring fresh talent. Despite a drop in US Treasury yields, the outlook for gold prices remains optimistic.