Gold Rallying Despite Hot US CPI

Gold Shrugs Off US CPI StrengthGold prices are rising on Friday despite yesterday’s stronger-than-forecast US CPI print. Inflation was seen rising again in the US last month with headline CPI printing 3.4% annually, up from 3.1% prior and above the 3.2% the market was looking for. Interestingly, however, rate cut expectations for March were unaffected. The market is currently pricing in a more than 60% likelihood of a cut in March, which remains the case despite yesterday’s print.  Clearly, the market is looking beyond this uptick in inflation as a likely temporary event, keeping USD muted for now.Middle East & Global Risk FlowsGold prices are also being supported through safe-haven inflow ahead of the weekend. Overnight, the US and UK actioned missile strikes on Houthi sites in Yemen. The missile strikes are aimed at halting the recent and ongoing Houthi attacks on Red Sea shipping routes. With Houthi rebels promising revenge for the attacks, fears of a broader Middle East conflict continue to unnerve investors here meaning there is plenty of room for further upside in gold near-term on increased safe-haven demand.Technical ViewsGoldThe correction lower in gold prices has found support for now into the latest test of the bull trend line. With prices turning higher from here, the focus is on a fresh test of the 2069.41 level with the 2023 highs sitting above as the next target. To the downside, 1973.51 remains the key support to monitor.