PRECIOUS METALS | Energy Prices and Inflation Concerns Weigh on Gold, Cinda Futures Says

Cinda Futures has highlighted that the current trajectory of gold prices is primarily influenced by rising energy costs, which are constraining interest rate expectations. According to Jin10, the ongoing Middle East conflict has kept crude oil prices elevated, with Brent crude futures consistently above $100. This situation has heightened market concerns about persistent inflation. In this context, market sentiment regarding the path of inflation decline has become cautious, weakening the pricing of interest rate cuts and temporarily strengthening the U.S. dollar, which in turn pressures gold. Despite previous weak employment data, inflation expectations driven by energy prices are offsetting this positive factor, making gold's financial attributes short-term bearish. On the policy front, the market widely anticipates that the Federal Reserve will keep interest rates unchanged for the second consecutive meeting. However, the key focus remains on forward guidance regarding interest rates, particularly Federal Reserve Chair Jerome Powell's assessment of inflation and geopolitical conflicts, which will directly influence market expectations for future easing measures.