Gold Rally Pauses as US Economic Data Impresses

Gold's record-setting rally has entered a consolidation phase following strong US economic indicators. The precious metal initially gained momentum amid escalating geopolitical tensions, with NATO's interception of Russian MiG-31 fighters NEAR Estonia boosting safe-haven demand. XAU/USD reached an all-time high of $3,791 early Tuesday, while gold-denominated pairs like XAU/EUR and XAU/GBP also hit records as capital fled weakening European currencies.

The rally lost steam after Federal Reserve Chair Jerome Powell struck a cautious tone on monetary easing, coupled with better-than-expected S&P Global PMI data showing continued US private sector expansion. Powell emphasized data-dependent policy decisions, noting the Fed will assess labor markets, growth, and inflation before considering rate adjustments.