XAU/USD remains range-bound despite weaker USD after June CPI fell more than expected, cooling Fed rate hike bets.
Gold prices hovered near $4,027 on Wednesday, failing to extend gains despite a softer US dollar after June inflation data undershot expectations. Annual CPI slowed to 3.5% from 4.2% in May, below the 3.8% consensus, while monthly inflation contracted 0.4%, the sharpest drop in nearly six years.
The weaker-than-expected print fueled bets of a less aggressive Federal Reserve, weighing on the USD. However, escalating US-Iran tensions and surging oil prices near one-month highs capped gold’s upside, as investors priced in renewed inflationary pressures and tighter global monetary policy.
Technical indicators showed fading bearish momentum, with the RSI nearing neutral territory, though bulls remained subdued below a key downward trendline. The MACD stayed positive but signaled fragile bullish momentum.