Gold Prices Surge Toward $2,800 as Investors Eye Inflation Data

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MARKETS TREND

Gold prices continued their upward trajectory on Friday, set for a fifth consecutive weekly gain as geopolitical concerns and economic uncertainty drove investors toward the precious metal.

Spot gold hovered around $2,795 after reaching an intraday high of $2,798. The rally was fueled by renewed fears of U.S. tariff impositions, with President Donald Trump reiterating plans for a 25% tariff on imports from Mexico and Canada.

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Historically, gold thrives in times of economic instability, serving as a hedge against inflation and currency volatility. Analysts suggest that ongoing tariff threats could propel gold beyond the $2,800 mark, particularly if investors seek refuge from market turbulence. The buildup of gold reserves in COMEX-approved warehouses—which surged 73.5% since November to 30.4 million ounces—further underscores the metal’s growing appeal.

“Repeated tariff threats have fueled safe-haven flows into gold,” noted IG market strategist Yeap Jun Rong. “Any downside surprise in inflation data could bring forward Fed rate-cut expectations, further supporting gold’s rise.”

Market Awaits Key Inflation Report for Fed Clues

Investors are now turning their attention to the December U.S. Personal Consumption Expenditures (PCE) report, scheduled for release at 13:30 GMT. This core inflation measure is closely monitored by the Federal Reserve to determine future monetary policy.

The Federal Open Market Committee (FOMC) opted to hold interest rates at 4.50% in its latest meeting, reinforcing its data-dependent stance. Fed Chair Jerome Powell emphasized that inflation trends and labor market conditions would dictate future policy adjustments. A lower-than-expected PCE reading could accelerate expectations for rate cuts, potentially boosting gold prices further.

“If tariff threats escalate into actual policies, gold could reach new highs well above $2,800,” said Tim Waterer, Chief Market Analyst at KCM Trade.

Technical Outlook: Gold Holds Firm Above $2,795

Gold remains in a strong uptrend, with buyers maintaining control above key support levels. The $2,772 pivot is acting as a critical inflection point, while resistance levels at $2,814 and $2,826 will be closely watched.

  • Resistance Levels: $2,814, $2,826, and $2,840

  • Support Levels: $2,772, $2,757 (50-day EMA), $2,748

  • Trend Signal: Bullish above $2,772, but a break lower could trigger pullbacks toward $2,730

For now, gold remains well-positioned for further gains, with inflation data and geopolitical risks being the next major catalysts.

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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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