Decline in U.S. consumer inflation may push gold above $1,900

The gold market sentiment remains optimistic. Several analysts expect that the precious metal will exceed the level of $1,900 per ounce later this week amid a decline in inflation.

The U.S. Labor Department will release data on the U.S. Consumer Price Index today, on January 12, at 13:30 GMT. According to forecasts, annual inflation is projected to reach 6.5%, which is 0.6% lower than in November.

Senior research analyst at FXTM Lukman Otunuga noted that a further price cooling along with lower bond yields would be beneficial for gold, which showed zero yields. In terms of technical analysis, the bulls maintain their position now and attempt to reach the level of $1,900 per ounce.

Ole Hansen, head of commodity strategy at Saxo Bank, also believes that gold has every chance to exceed the aforementioned level. However, he outlined some risks that might cause a price decline. In his opinion, bullish momentum supports technical and speculative purchases, while long-term investors in the ETF market remain moderately active. This increases the risk of a price correction in the short term.