After a week of an unyielding rally and uncharted records for gold, the precious metal takes a small tumble and pulls back after Tuesday’s hotter-than-expected CPI inflation data. Gold recoiled 1% from its peak of $2,195 last week and was trading around $2,150 USD this Tuesday. The report had the CPI at 3.2%, which was 0.1% higher than expected. After the CPI report, the US dollar saw momentum and had a slight uptick. Historically, gold and the US dollar move in opposite directions due to the increased opportunity cost of holding gold in high inflation periods since it is a non-interest producing asset, weakening its demand and driving gold spot price down. The next key threshold for gold is to see if it can break through the $2,200/oz barrier.

Although gold dipped slightly, the overall sentiment is still bullish for gold since it is still hovering around its record highs, hovering at the $2,160 range. Investors are currently waiting for more US retail sales data like the PPI report and jobless claims to gauge how gold will move next. Sentiments are still in favour of a rate cut in June.

After the CPI announcement, silver prices followed in gold’s footsteps and plunged 1%. Historically, gold and silver prices have a positive correlation so as long as gold goes up, silver will likely follow. After gold’s recovery from the slight hiccup, silver jumped 3% on Thursday, going up to $24.90/oz. Both platinum and palladium fluctuated within 1% after the inflation data was released.