The price of gold has fallen for two consecutive weeks, just below 1900. Today, it is firmly pegged at the US CPI.

On Tuesday (November 14) entered the European session, spot gold fluctuated narrowly, awaiting the release of key US CPI data. Before that, Federal Reserve officials, including Chairperson Powell, had hit back at market bets on early interest rate cuts, and gold prices had fallen for two consecutive weeks.

Gold prices traded in a narrow range on Tuesday as investors refrained from taking big positions ahead of US inflation data that could shed more light on the possibility of further interest rate hikes by the Federal Reserve.

Spot gold continued to fluctuate in a narrow range around $1945, hitting a more than three-week low of $1,931 on Monday. Gold prices have closed down for two consecutive weeks.

Global market participants awaited the release of the US Consumer Price Index (CPI) at 13:30 GMT on Tuesday (21:30 PM Hong Kong time on Tuesday) and the producer price index (PPI) on Wednesday.

Wall Street economists expect headline CPI growth to slow to 0.1 per cent in October from 0.4 per cent in September, according to a Reuters poll. Core inflation is forecast at 0.3 per cent, unchanged from September.

Kyle Rodda, analyst at financialmarekt at Capital.com, said: "Any unexpected upside in the data could cause the market to reprice somewhat the likelihood of another rate hike, if not in December, perhaps early next year."

Mr. Rodda added: "If that happens then it would be a reasonably negative impact on gold... The fact is that inflation is still quite persistent and interest rates will have to stay relatively high in the short term."

Federal Reserve Chairperson Jerome Powell and his policymakers have tried in recent days to refute market expectations that the Federal Reserve has ended its aggressive rate hike cycle.

The dollar index was trading at 105.6, down slightly on the day.

Yusuke Miyairi, FX strategist at Nomura, said: "I think the dollar will react asymmetrically to the data, and if the data falls below or matches market expectations, the dollar will be sold off, but I don't think this will start a new trend, with most currencies moving in ranges except for USD/JPY."

Although gold is seen as a hedge against inflation, higher interest rates raise the opportunity cost of holding it.

Federal Reserve officials, including Federal Reserve Chairperson Jerome Powell, said last week that they were still unsure whether interest rates would be high enough to end the fight against inflation.

The Chicago Mercantile Exchange's FedWatch tool shows that the market expects an 86% chance that the Federal Reserve will leave interest rates unchanged in December.

Meanwhile, the U.S. Commodity Futures Trading Commission (CFTC) said Monday that COMEX gold speculators' net long position fell by 1,107 contracts to 105,236 contracts in the week ended Nov. 7.