Gold Commentary: Gold is fluctuating at high levels; focus on tonight's US inflation data

Overnight London spot precious metals pulled back after rising; COMEX gold increased by 1.86%, SHFE gold rose by 0.98%. Regarding geopolitical conflicts, after Trump stated on Monday that the U.S. war with Iran might end soon, yesterday Trump mentioned considering exemptions from oil-related sanctions and expressed willingness to dialogue with Iran. Iran responded that it would not trust any U.S. promises, and “military operations have entered a new phase.” Intense government statements continued to ease market panic, leading to a decline in the dollar and crude oil, while market risk appetite continued to recover. However, U.S. government statements remain inconsistent, and developments in U.S.-Iran tensions are uncertain, with geopolitical volatility still a key factor in short-term trading. Recently, gold’s movement shows a certain negative correlation with oil and the dollar, and a positive correlation with U.S. stocks, indicating concerns about liquidity in the gold market. Due to geopolitical fluctuations, short-term strategies prioritize timing over directional bets. Additionally, tonight’s focus is on U.S. CPI data, with market expectations at +2.4% year-over-year and +0.2% month-over-month, both unchanged from January. January’s component data shows energy down 1.5% month-over-month, mainly due to gasoline. Considering crude oil’s slight increase in February, this may impact February inflation data. If inflation concerns re-emerge, combined with last week’s unexpectedly weak employment data, the market expects the Federal Reserve’s interest rate decision this month to remain unchanged, with particular attention to whether the rate cut outlook for the year shifts. (Everbright Futures)