Geopolitical Tensions Push Oil, Gold Higher Ahead of US CPI Data

Global markets are on edge ahead of crucial US inflation data due later today. Oil and gold prices have risen in response to escalating geopolitical tensions, as North Korea launched a ballistic missile off the Korean Peninsula's east coast and Iran doubled down on its commitment to govern the Strait of Hormuz.

The US and Yemen's Iran-aligned Houthis reported separate attacks on shipping, with four crew members of an Egyptian-owned ship killed in a Houthi strike. Markets are bracing for the release of July's consumer price index (CPI) data, which could set expectations for a potential Federal Reserve rate hike.

US crude rose 0.89% to $83.94 a barrel, and Brent advanced to $89.60 per barrel, up 0.78% on the day. Spot gold gained 0.46% to $4,387.03 an ounce. MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.5%, while Japan's benchmark Nikkei share gauge traded flat.

Money markets show an even chance of a rate hike next month, with consumer prices expected to edge up 0.1% in July after falling 0.4% in June. Annual CPI inflation is forecast to slow to 3.4% from 3.5% a month earlier.