GOLD STILL BULLISH

Analysis: Factors Driving Gold Prices Up

[FUNDAMENTAL ANALYSIS]

Weak Core Prices and Potential Fed Rate Cuts:
Recent data showing softer core inflation has heightened concerns about the US economy's robustness. This softness has increased the likelihood that the Federal Reserve will consider cutting interest rates to stimulate economic growth and prevent deflation.

Impact of Weak Core Prices:
Weak core prices signal subdued economic activity, prompting the Federal Reserve to consider rate cuts. Lower interest rates generally weaken the dollar as investors seek higher returns in other currencies, making gold more attractive as an alternative investment.

Potential Fed Policy Response:
In light of the weak core inflation data, the Federal Reserve is likely to implement monetary policy measures aimed at boosting economic activity. Reducing interest rates is a key tool in this arsenal, and such a move is expected to weaken the dollar, thereby increasing demand for gold as a hedge against a depreciating currency.

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