After two days of a bearish correction, gold prices resumed the ascent and got back above $1,330 on Wednesday. Yesterday, the bullion briefly slipped to lows below $1,320 though trimmed intraday losses afterward.
The precious metal derives support from a combination of risk aversion and a weaker U.S. dollar. Risk sentiment has deteriorated amid tensions in Hong Kong, where authorities postponed the second reading of a bill allowing extradition to mainland China as tens of thousands of protesters blockaded government headquarters.
Meanwhile, the greenback came under the selling pressure ahead of the US CPI data due later today. Should the figures disappoint and come in lower than expected, expectations of a rate cut by the Fed will rise further, which could fuel further USD sell-off and give the additional support to gold prices. In this scenario, the bullion may challenge the $1,337 figure, which is standing on the way to $1,340.