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