Gold rises on weaker dollar, lower yields ahead of U.S. inflation data
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Gold prices moved higher on Tuesday, benefiting from a weakened U.S. dollar and declining Treasury yields, as investors cautiously awaited critical U.S. inflation data. Spot gold rose 0.4% to reach $2,901.13 per ounce, while U.S. gold futures saw a modest gain of 0.2%, reaching $2,905.70.
The U.S. dollar index hovered near its recent four-month lows, enhancing gold’s attractiveness for international investors by making bullion cheaper for buyers outside the U.S. Concurrently, benchmark 10-year Treasury yields decreased, further supporting gold’s appeal as a non-interest-bearing asset.
According to Ilya Spivak, head of global macro at Tastylive, gold's overall bullish trend remains intact, with current market conditions favoring further upward momentum. Prices have remained relatively stable within the $2,830-$2,960 range over the past month, and analysts suggest a definitive breakout above or below this range could signal the next major directional move for the precious metal.
Investor sentiment remains cautious amid ongoing economic uncertainty spurred by former President Donald Trump’s recent tariff actions against Canada, Mexico, and China. Trump's policies have heightened concerns about potential inflationary pressures and economic slowdown, causing global markets to react negatively.
Market attention now shifts to the upcoming U.S. Consumer Price Index (CPI) release on Wednesday, which will likely influence Federal Reserve policy decisions. Gold traditionally serves as a hedge against inflation and political risk; however, persistent inflation may prompt sustained higher interest rates, potentially diminishing gold's relative attractiveness.
In other metals, spot silver climbed 0.3% to $32.21 an ounce, platinum dipped slightly by 0.1% to $956.63, and palladium slipped 0.1% to $942.10.
Investors are advised to closely monitor inflation indicators and ongoing trade developments, given their potential to significantly impact precious metals pricing and overall market sentiment.
The U.S. dollar index hovered near its recent four-month lows, enhancing gold’s attractiveness for international investors by making bullion cheaper for buyers outside the U.S. Concurrently, benchmark 10-year Treasury yields decreased, further supporting gold’s appeal as a non-interest-bearing asset.
According to Ilya Spivak, head of global macro at Tastylive, gold's overall bullish trend remains intact, with current market conditions favoring further upward momentum. Prices have remained relatively stable within the $2,830-$2,960 range over the past month, and analysts suggest a definitive breakout above or below this range could signal the next major directional move for the precious metal.
Investor sentiment remains cautious amid ongoing economic uncertainty spurred by former President Donald Trump’s recent tariff actions against Canada, Mexico, and China. Trump's policies have heightened concerns about potential inflationary pressures and economic slowdown, causing global markets to react negatively.
Market attention now shifts to the upcoming U.S. Consumer Price Index (CPI) release on Wednesday, which will likely influence Federal Reserve policy decisions. Gold traditionally serves as a hedge against inflation and political risk; however, persistent inflation may prompt sustained higher interest rates, potentially diminishing gold's relative attractiveness.
In other metals, spot silver climbed 0.3% to $32.21 an ounce, platinum dipped slightly by 0.1% to $956.63, and palladium slipped 0.1% to $942.10.
Investors are advised to closely monitor inflation indicators and ongoing trade developments, given their potential to significantly impact precious metals pricing and overall market sentiment.