The report on consumer prices showed that last month, annual inflation in the United States remained at the level of June, when a 13-year record was broken. The indicator increased by 5.4% in July compared to the same period of the previous year.
It can be recalled that economists had expected inflation to slow down to 5.3% year-on-year and to 0.5% month-on-month. The latest indicator coincided with the forecast: the consumer price index rose by 0.5% in monthly terms in July, but fell from 0.9% in June.
Despite the fact that the rate of inflation slowed down last month, analysts see signs that consumer price growth has reached its peak. This is indicated by the disruptions in the supply chain caused by the pandemic, which literally "permeate the economy".
The fact that inflation remained at a 13-year high on an annualized basis had a negative impact on the dollar exchange rate. After the release of statistics, the index of the US currency, reflecting its position in relation to the six main competitors, went down. According to the results of Wednesday, the dollar sank by 0.3%.
Another important indicator that affects the pricing of gold also decreased yesterday. The yield on 10-year Treasury bonds fell to 1.32% from 1.34% on Tuesday.
In this favorable situation, the yellow asset, which is traditionally perceived by investors as a protective tool against inflation, sharply rushed up. The quotes jumped to the level of $1,753.30. Thus, the difference from the previous session was $21.60, or 1.2%.
According to the FactSet resource, yesterday's increase in gold was the sharpest daily growth of the asset in 2 weeks. Even the hawkish comments of the American regulator, which were made on Wednesday, could not prevent its rise.
Thus, the president of the Federal Reserve Bank of Dallas, Robert Kaplan, said that he would insist that his colleagues at the Central Bank announce a plan to reduce bond purchases at their next meeting at the end of September.
The president of the Federal Reserve Bank of Kansas City, Esther George, was also in solidarity with him. Yesterday, she noted that the time has come to complete the Central Bank's bond purchase program.
Meanwhile, neither Kaplan nor George are currently voting members of the Federal Open Market Committee (FOMC), unlike Charles Evans of the Chicago Fed. On Wednesday evening, he expressed the opposite opinion, recommending not to rush to raise interest rates and "wait a little longer."
On Thursday morning, the main precious metal is still inspired by yesterday's events, but at the same time it is growing symbolically against the background of a stable dollar. At the time of preparation of the material, the asset was trading at $1,753.75, having risen by only $0.45, or 0.03%.
Unlike the yellow asset, silver is getting cheaper during today's trading. In the morning, the gray asset sank by 0.06% to $23,473, while it ended yesterday's session with a slight increase of 0.4%.
All popular metals showed positive dynamics on August 11, with the exception of palladium, which fell by 0.6% to $2,632.80. So, copper rose by 0.3%, to $4.3675. Platinum gained 2.9% and was trading at the close at $1,015.60.