After an incredible six days of record-breaking price gains, the latest headline inflation figures from the US have halted gold in its tracks.

Gold has gained more than 6% in the past month, rising from $1,984.71 per ounce to hit a new all-time high of $2,195.49 at its peak. The $2,200 level proved enough of a challenge to hold gold up for now, but the latest rally included six consecutive record closes, and has sparked plenty of excitement within markets.

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Tuesday saw headline inflation come in slightly higher than expected at 3.2%, with core inflation at 3.8% annually. Although this measure of inflation is not the Fed’s preferred option, it was enough to bring further doubts as to when interest rates in the US will be cut. The CME FedWatch Tool shows that markets are still expecting the June 12th meeting to provide the first rate cut.

It is notable however that the figures only saw a slight increase in the US dollar index and could only halt rather than reverse gold’s recent gains. Much of the rally in gold far exceeded any dollar movement, with central bank and retail demand from China also believed to have contributed to some of the rally. With events like Gaza, Haiti, and a rematch between Biden and Trump on the horizon, there is plenty of uncertainty still in the world to contribute for demand for a proven safe haven like gold.

The dip puts gold at $2,159.55/ €1,976.20, and markets will be watching for the direction gold now takes. Next week will see the Fed’s March rate meeting and a more hawkish tone could put some further pressure on gold. If the Fed’s language does point towards a cut in the summer then it could re-spark the rally. Gold already saw good consolidation form above $2,000 for the start of this year, so will $2,100 now become the new normal for gold, putting $2,200 well within reach when the next leg-up begins?

Given so much of the rally was caused by uncertain drivers, we may not have to wait to next week to see further movement, if buyers pile in on this recent dip it could soon set gold moving again, pushing prices back towards $2,200 and above €2,000.