Gold traded lower in early trading Monday morning after posting a surge past the $2,030 level at last week's close.
It is a response to the Fed's uncertain actions in determining its interest rates later and giving an advantage to the value of gold during the Core CPI report last week.
The price of gold is now at $2,032.80 which is down by 0.14% since it opened early this morning.
Meanwhile, stronger-than-expected US inflation data in recent weeks has fueled various speculations in the market regarding interest rate cuts.
Last week, Fed Governor Christopher Waller said that his officials were in no rush to implement interest rate cuts immediately.
Investors now expect the US may not cut rates until June. The forecast strengthened in the market ahead of expectations for March. Market participants now continue to be guided by the Fed's latest decision which is expected to make three cuts this year.
Looking at the situation in the Middle East, the Houthis continue to attack commercial ships in the Red Sea and strengthen their weapons stockpile in Yemen despite the US having carried out a series of counter-attacks over the past few weeks.
The increasing geopolitical tension in the Middle East is able to increase the price of gold as it is considered a 'safe-haven' asset.
This week, traders should keep an eye on the Annual US Gross Domestic Product (GDP) data for the fourth quarter which will be released on Wednesday and the Core Personal Consumption Expenditure Price Index (Core PCE) on Thursday.
These data will give a clearer direction to the price of gold throughout this week.
