XAU/USD faces barriers around $1,770 ahead of data on US inflation estimates, according to the gold price forecast

In the Asian session, the gold market (XAU/USD) noticed selling action near the $1,770.00 immediate barrier. The US Dollar Index (DXY) has widened its upward trajectory above a four-day high at 105.60, putting the precious metal under pressure.

After a sell-off that continued for the second trading session, S&P500 futures are significantly worse, indicating that investors are currently taking a risk-averse stance. The 10-year US Treasury yields have partially recovered their losses and are currently at 3.56% as of the time of publication.

The market has become pessimistic due to recent indicators of a comeback in inflation following the resilience displayed by the US economy in November through services and labor demand. This has increased the possibility that the Federal Reserve (Fed) would give higher interest rate peak guidance at its monetary policy meeting next week.

Prior to that, however, consumer inflation predictions over the next five years took center stage. Since inflation has already shown signals of slowing, long-term inflation expectations are still anchored. The forward-inflation data had previously come in at 3%.