Gold Gains Ground as Weak CPI Fuels Rate Pause Bets

Gold gained slightly above $2915 amid weak US CPI data. It hits an intraday  high of  $2923 and is currently trading around $2915.

Subdued Inflation Boosts Gold

The U.S. Consumer Price Index (CPI) for February 2025 showed a 0.2% increase in the month, with the all-items index 2.8% higher on a year-over-year basis and the core CPI 3.1% higher. The key drivers were a 0.3% rise in the shelter index, a 4.0% decline in airline fares, and a 1.0% fall in gasoline prices, as well as a 0.2% increase in the energy index on higher electricity and natural gas prices. This data, indicating relatively flat but slightly below-target inflation, can influence Federal Reserve interest rate policy and the valuations of currency and stock markets

Rate Pause Expectations Rise 

According to the CME Fed Watch tool, the chances of a rate pause on the Mar 19th 2025 meeting have increased to 97% from 94% a week ago.

Technical Analysis: Key Levels and Trading Strategy

Gold prices are holding above the short-term moving averages 34 EMA and 55 EMA and above long-term moving averages (200 EMA) in the 4-hour chart. Immediate support is at $2880 and a break below this level will drag the yellow metal to $2867/$2850/$2830/$2800/$2770/$2740. The near-term resistance is at $2930, with potential price targets at $2940/$2957/$3000.

It is good to buy on dips around $2880 with a stop-loss at $2850 for a target price of $3000.