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Gold trades above $4,000 as Iran tensions offset cooler US inflation

XAU/USD was around $4,027 after June CPI cooled, while oil stayed near one-month highs amid rising Iran risks.

Reported · Written up by our desk · Precious Metals

Gold (XAU/USD) drifted lower in “inside trading” on Wednesday, staying above the $4,000 level and holding near $4,027, according to FXStreet’s market analysis.

The metal’s move came as inflation data softened expectations for additional Federal Reserve rate hikes, with June yearly CPI slowing to 3.5% from 4.2% in May and monthly inflation falling 0.4%.

FXStreet said that repricing of Fed rate expectations weighed on the US dollar across the board, but gold did not fully benefit because tensions in Iran and higher oil prices supported fears of renewed inflation and tighter global monetary policy.

With oil near one-month highs after threats of further attacks and energy route closures, FXStreet noted gold’s technical setup, including a bullish divergence on the daily RSI(14) and support clustered between about $4,020 and $3,885.

Latest closeGold $4,058.20 ▲1.5%

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