Gold up with upcoming CPI turning as important as a Fed meeting

LONDON (January 15) Gold’s price (XAU/USD) turns flat for this week and pops higher for the second day in a row, trading in the $2,680s on Wednesday, after a softer-than-expected United States (US) Producer Price Index (PPI) release the previous day triggered substantial easing in US yields. Market expectations are now higher for a softer US Consumer Price Index (CPI) release this Wednesday as well. A softer reading would be beneficial for Gold to head higher. 

On the economic data front, the US CPI release for December will draw all attention on Wednesday. After the surprise softer PPI print on Tuesday, market expectations are that both the monthly headline and core CPI gauges would soften from their previous readings. Later in the day, be on the lookout for comments from three Federal Reserve officials. 

Daily digest market movers: CPI data gains in importance

• President-elect Donald Trump did not comment or push back on the rumors that his administration would likely implement its tariff schemes in a very steady and gradual approach. 
• The US 10-year benchmark rate falls to 4.77% at the time of writing on Wednesday, fading from its fresh 14-month high of 4.802% seen on Monday.
• The CME (Chicago Mercantile Exchange) Fedwatch tool currently shows that the Federal Reserve will keep rate expectations steady until its meeting on June 18, when odds of keeping rates unchanged at current levels stand at 43.6%, compared to 56.4% for lower rates. 
• At 13:30 GMT, the US Consumer Price Index data for December will be released. The monthly core CPI measure is expected to rise 0.2% compared to 0.3% in the previous month. The monthly headline CPI reading is expected to increase steadily by  0.3%.
• At 14:00 GMT, Federal Reserve Bank of Chicago President Austan Goolsbee will discuss the economy at the Wisconsin Bankers Association 2025 Midwest Economic Forecast Forum.
• At 15:00 GMT, Minneapolis Fed President Neel Kashkari will give welcoming remarks and participate in a fireside chat with Jay Debertin, President and CEO of CHS, Inc., as part of the Minneapolis Fed’s 2025 Regional Economic Conditions Conference.
• At 16:00 GMT, Federal Reserve Bank of New York President John Williams delivers keynote remarks at the "CBIA Economic Summit and Outlook 2025" event organized by the Connecticut Business and Industry Association (CBIA) in Connecticut.

FXStreet