Gold holds near $4,057 as oil-led inflation fears cap recovery

Gold futures traded at $4,056.80 an ounce, up 0.16% on the session, as oil-led inflation concerns limited the metal's recovery from a sharp June selloff, according to ING.

"Oil-led inflation fears are capping gold's price recovery," ING analysts said in a note published July 24, pointing to rising energy costs as a headwind for precious metals.

Gold has struggled to regain momentum after falling from an all-time high above $5,300 an ounce in January to around $4,100 by late June, a decline of more than 20%. The LBMA Gold Price PM fix, which underpins the SPDR Gold Shares ETF (GLD), has tracked the broader pullback. GLD, the largest gold-backed ETF with $130 billion in total assets, closed at $371.52 on the NYSE, down 2% on the day and 6.73% year-to-date. The fund's 52-week range spans $300.96 to $509.70.

The inflation concern stems from rising crude prices, with WTI crude holding above $89 a barrel and Brent near $97.60. Higher energy costs feed into broader inflation measures, potentially keeping the Federal Reserve on a hawkish path. June CPI data showed a 0.4% month-over-month decline — steeper than the 0.1% drop expected — while core CPI held flat versus a 0.2% consensus estimate. The mixed inflation picture has done little to clarify the Fed's next move, with the next policy decision due in September.

Gold's $4,000 level has emerged as a key support zone. The metal reclaimed $4,040 on July 21 after testing the round number earlier in the month, according to COMEX data. A sustained break below $4,000 could accelerate selling, while a recovery above $4,100 would signal renewed buying interest. The next catalyst for gold prices is the July 31 Federal Reserve meeting, where any shift in forward guidance on rates could determine whether the metal holds support or extends its decline.

This article is for informational purposes only and does not constitute investment advice.