$XAU/USD remains pressured as traders anticipate FOMC meeting

Gold price ($XAU/USD) extended losses for a third straight session on Tuesday. Expectations of interest rate hikes in the United States and Europe due to the impending Federal Open Market Committee (FOMC) meeting on June 14-15 have caused a fall in demand for the precious metal.

Gold is still licking the U.S. NFP-related wounds as spot gold fell by 0.1% to $1,839 per ounce during its first Asian session on Tuesday. It is slowly recouping and is hovering around $1840 but the $1850 remains an intimidating boundary.

The U.S. Consumer Price Index (CPI) approaching

The Consumer Price Index (CPI) is a metric that tracks the average change in prices paid for a market basket of goods and services by urban consumers across time. There are indexes for the United States and several geographic locations.

The upcoming U.S. Consumer Price Index and MoM statistics scheduled to be released on Friday, June 10 will be significantly crucial for wide USD dynamics. According to analysts, core prices likely remained high in May, with the series increasing by 0.5% MoM for the second month. According to their MoM predictions, total/core prices are expected to rise 8.4%/5.9% YoY.

You can check our economic calendar to keep up with the approaching CPI and other market events from around the world.

Gold Price Forecast: Traders are getting set for U.S. inflation

Gold prices are below their bull-market defining trendline, and there is no sign that the Fed will blink. Analysts believe these traders pose the biggest risk of a liquidation vacuum as we come out of the pandemic. A fall below $1800/oz could trigger further cumulative translation adjustment (CTA) liquidations, which is expected to put more pressure on gold.

Will the FOMC raise interest rates again?

Meanwhile, traders will be anticipating the Federal Open Market Committee meeting on June 14-15. Last week, Fed speakers were unified in their support for a 50-basis-point rise at the June and July meetings. Markets are also pricing in another 50 basis points in September but are keeping an eye on month-to-month inflation figures to ensure they don't cool significantly before then.

Conclusion

While the price of gold is still undulating, and speculations could go back and forth, the CPI has undoubtedly become pertinent. Only time will tell how the inflation in the U.S. will evolve and how well traders will adjust to it. However, these CPI predictions should help traders wag through the days ahead.

You can find different assets tradable on NAGA including $XAU/USD and other popular CFDs on commodities.

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