Oil markets have stayed elevated after the Iran‑U.S. conflict entered its 192nd day and Ukrainian strikes hit Russian refineries. U.S. diesel prices reached a record $5.85 per gallon, up nearly 60% from a year earlier, adding energy‑driven inflation pressure.
The Trump administration has intensified public pressure on the Federal Reserve to cut rates. President Donald Trump, Vice President JD Vance and senior economic adviser Peter Navarro have all urged the Fed to lower borrowing costs, with Trump even threatening tariffs on countries with trade surpluses if rates are not reduced. Despite the pressure, markets are pricing a roughly 60% chance of a rate hike at the September 15‑16 FOMC meeting, supported by a strong jobs report.
Inflation data remain mixed. The three‑month annualised core CPI is reported at 1.6%, while the core PCE index – the Fed’s preferred gauge – sits just above 3%. Several Fed officials have warned that inflation has run above the 2% target for five years, and three members dissented in July, favoring a quarter‑point hike.
Against this backdrop, the analysis on Investing.com notes that gold futures are reflecting growing stagflation fears. On Monday the contract opened at $4,470.19, hit a high of $4,476.41 and a low of $4,426.29, and was trading at $4,440.40, just below the key support level of $4,444. The analysis suggests the next support to watch is $4,399.16, with a break potentially leading to the 100‑day EMA at $4,381.68. On the one‑hour chart, a “Three Black Crows” bearish pattern has formed, raising the possibility of further downside.
Traders will also watch the upcoming CPI release, which Fed officials have said will be a critical gauge of whether inflation is easing. No Fed member has recently signaled imminent rate cuts, leaving the market to balance geopolitical risk, energy price pressure and policy uncertainty.
