Gold price remains steady at around $2,045 due to the US bank holiday and geopolitical tensions in the Middle East. The US Producer Price Index (PPI) for December rose by 1.0% year over year, which is lower than market expectations, signaling potential deflationary signs that could lead to a Federal Reserve interest rate cut in March. This, in turn, is causing a decrease in the value of the US dollar, providing support for the gold price.
Additionally, the escalating geopolitical tensions in the Middle East, particularly the strikes against Houthi targets in Yemen by the US and UK, are encouraging safe-haven buying and benefiting the gold price.
As the US bank holiday continues, the gold price will likely be driven by risk sentiment. In the upcoming days, economic data releases such as the NY Empire State Manufacturing Index, Retail Sales, and the Michigan Consumer Sentiment Index will provide further insight into the market and may influence the gold price.
