Dude, the inflation data coming from the US last night shook up global markets. Bloomberg’s headline was right on point too. Where US inflation is headed, what the Fed decides, and how that impacts all assets—especially gold—is crucial. 🤔 What’s US inflation gonna show this time around? Is it still climbing, or is it signaling a drop? How do you think gold will react to this? Are we in for some wild short-term moves?
My take: If inflation stays high, rates will have to stay high for longer, which could put pressure on non-yielding assets like gold. But if inflation starts trending down, gold could shine again. What do you think? What should we brace for in US inflation?
How will US inflation affect the markets? Will gold soar or crash?
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Just yesterday we saw core PCE jump from 4.6% to 4.7% in the US inflation data, bro. That means the Fed’s roadmap could change. In my view this is a pretty tough equation for gold in the short term because with inflation still running at high levels the pressure on the Fed to keep rates high for longer is increasing. We’re also seeing domestic interest in US Treasury bonds rise, which basically shows the safe‑haven hunt is still on.
But here’s the thing, guys: gold is a fixed‑income asset, so it gets hit directly by rising real rates. For example, when the 10‑year US Treasury yields hit the 4.2% area, it’s normal for spot gold to stay below $1,900 an ounce. So unless we get a clear signal that inflation has peaked, we shouldn’t expect a quick bounce for gold. Of course, if the Fed suddenly eases its stance, gold would rally instantly, but given the current data that scenario looks weak.