The international gold price has hit a new high in nearly three weeks, but it will have to wait for it to be released completely

On Tuesday (July 11), the international gold price rose to a new high since June 21 to $1,938.20/ounce, benefiting from the weakness of the US dollar. But investors avoided making big bets ahead of the release of US inflation data that could affect the Federal Reserve's policy trajectory, and the action on gold prices remains to be released.

Beijing time 15:26, spot gold rose 0.25% to $1929.95/ounce; COMEX gold futures main contract rose 0.23% to $1935.4/ounce; the dollar index fell 0.16% to 101.791.

Matt Simpson, senior market analyst at City Index, said gold prices were supported by dollar weakness as the Federal Reserve seemed to suggest they were at the end of a tightening cycle, "but gold investors seem to be avoiding overtrading ahead of the U.S. inflation report."

This week focuses on the upcoming U.S. CPI (Consumer Price Index) data on Wednesday (July 12). Core CPI in June is expected to rise by 5% year-on-year. Several Federal Reserve officials said on Monday (July 10) that the Federal Reserve may need to raise interest rates further to reduce inflation.

San Francisco Fed President Mary Daly said at a Brookings Institution event that the risk of raising rates too little still outweighs the risk of raising rates too much. In addition, Cleveland Fed President Meister reiterated that the Federal Reserve needs to tighten monetary policy further to reduce inflation.

But Fed officials also acknowledge that the current monetary tightening cycle is coming to an end. According to the CME's "Fed Watch" tool, investors believe the Fed will raise interest rates to 5.25-5% at its July meeting and keep them there until 2024.

US employment data on Friday showed that non-farm payrolls grew at their slowest pace in 2.5 years in June, suggesting the labour market is cooling. Separately, the New York Fed's monthly survey, released on Monday, showed that one-year consumer inflation expectations fell to 3.8 per cent in June, the lowest since April 2021, from 4.1 per cent, which could prompt the Fed to soften its hawkish stance.

Christopher Wong, executive director and FX strategist at OCBC, said: "Any disappointment [that CPI is higher than expected] could lead to a hawkish repricing that would reduce gold's appeal. More importantly, the market needs to start embracing the '2024 rate cut 'narrative so gold can shine further."