Economic data published on Thursday showed the Producer Price Index in the US fell by 0.5% in July, and the annual rate fell to 9.8%, against expectations of a 0.2% monthly advance. On Wednesday, it was reported the Consumer Price Index was unmoved in July against expectations of a 0.2% gain. The decline in inflation weighed on the US dollar.
Investors are expecting the Fed to hike rates by at least 50 basis points at the September meeting. Though, US yields are up even amid the probability of an inflation peak in the US. The US 10-year yield is up 1.90% at 2.83%, while the 2-year is at 3.20%, both at the highest level in almost a week.
The rise in US yields limited the upside in gold. XAU/USD’s inability to hold above $1800, even after the recent US data, rises doubts about the rally. The urgent support is seen at $1785 followed by the weekly opening at $1774. If the yellow metal consolidates above $1800 more gains seem likely
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