The GBP/USD pair remains under pressure, trading near 1.2950 during Wednesday's European session. Simultaneously, gold prices maintain a narrow range, reflecting market caution ahead of key economic data releases. The focus is primarily on the anticipated US Consumer Price Index (CPI) data, which is forecasted to show a 2.9% increase for February. This data is crucial as it is expected to indicate a deceleration in inflation measures, potentially signaling a broader economic slowdown.
Gold prices are currently trading above $2915, with the near-term bias leaning bullish as long as they remain above the $2900 mark. The $2900 level is supported by the 10-day moving average (10DMA), establishing a solid support foundation. Additionally, a higher base at $2880 serves as a crucial support level. The Fibonacci level at $2868, representing 23.6% of the $2582/$2956 upward leg, is also significant as it underscores potential support zones.
Market participants are closely monitoring the US CPI data, which could confirm expectations of slowing inflation. Both monthly and yearly inflation indices are anticipated to exhibit a deceleration, heightening concerns about the US economy's potential for a more pronounced slowdown. The global economic climate remains fragile, compounded by geopolitical tensions and fluctuating market dynamics.
US tariff policies continue to play a pivotal role in gold's market performance. The imposition of a 25% tariff on all steel and aluminum imports by the US has had ripple effects across global trade and economic stability. These tariffs add complexity to an already uncertain economic landscape, influencing commodity prices, including gold.