Gold Bounces Back from Recent Losses Amid Interest Rate Hike Expectations

Gold prices have rebounded after recent losses, rising by over 1% on Friday to reach $4,363.01 per ounce. Despite strong US inflation data, which bolstered expectations of an interest rate hike by the Federal Reserve next week, gold has found a short-term floor.

The metal's price action suggests it is recovering rapidly after a brief dip, and market volatility is muted with a 70% chance of a Fed rate hike already priced in. US gold futures settled nearly unchanged at $4,408.90 an ounce.

However, gold demand in India was subdued this week due to volatile prices, while investment demand remained strong in top consumer China. The Consumer Price Index rose by 0.4% last month after edging up 0.1% in July.