Gold prices rose on Monday, supported by a retreat in the dollar as investors looked ahead to US inflation data that could define the Federal Reserve’s moves on interest rates.
Spot gold gained 0.3% to $1,922.89 per ounce by 3:13 AM ET (0713 GMT), having lost 1% in the previous week. US gold futures rose 0.2% to $1,946.30.
The US dollar and benchmark 10-year bond yields dropped 0.3%, making non-yielding bullion more attractive for overseas buyers.
“The precious metal will likely be relying on a pullback in yields in order to again challenge the $1,950 level,” KCM Trade Chief Market analyst Tim Waterer said in a note.
The US Consumer Price Index (CPI) data for August due on Wednesday is expected to shape the Fed’s interest rate decisions this year.
The CPI is expected to show that inflation slowed in August, but it is still likely to be above the Fed’s target of 2%. If inflation does come in lower than expected, it could give the Fed more leeway to delay raising interest rates.
Gold is often seen as a hedge against inflation, so a weaker US dollar and lower interest rates could support prices in the near term. However, if inflation does start to rise more quickly, gold could lose some of its appeal.
Elsewhere, spot silver climbed 0.5% to $23.02 per ounce, platinum was up 0.4% at $896.16 after a 7% decline last week, and palladium edged 0.5% higher to $1,203.68.
- The article provides more context about the factors that could affect gold prices, such as the US dollar and interest rates.
- The article also discusses the role of inflation in gold prices.
- The article mentions other precious metals, such as silver, platinum, and palladium.
- The article has a more conversational tone than the original article.