FX.co ★ Gold Rises to Fresh Record

Gold prices reached new record highs, approaching $4,620 per ounce on Tuesday, driven by the easing concerns over renewed inflationary pressures following US inflation data releases. The headline Consumer Price Index (CPI) for December remained steady at 2.7%, while core inflation dropped to 2.6%, marking the lowest level since 2021. This softer monthly core inflation reading bolstered the anticipation that monetary policy would not become more restrictive. In addition to the favorable inflation scenario, there was a heightened demand for safe-haven assets due to emerging worries about the US Federal Reserve’s independence and escalating geopolitical risks. US prosecutors have initiated a criminal investigation concerning Fed Chair Powell's testimony from last June, which Powell associated with President Trump's efforts to compel the Federal Reserve into reducing interest rates. Further compounding the uncertainty, President Trump announced a 25% tariff on countries engaged in trade with Iran, following multiple warnings of potential military interventions amidst the widespread protests in the country.