Gold Prices Hit Two-Month High as FOMO and Safe-Haven Flows Boost Market

Gold prices rose for the third consecutive session on Tuesday, reaching its highest level in over two months. Spot gold climbed 1% to $4,432.74 per ounce by 0217 GMT, with US gold futures rising 1.7% to $4,492.60.

The market is being driven by a mix of fear of missing out on the rebound from $4,000, short-covering from speculative accounts, and safe-haven flows returning to the market, according to IG market analyst Tony Sycamore.

Looking ahead to this week's economic data releases, investors are likely to focus on Wednesday's US consumer price report and Thursday's producer price data. These reports will shape monetary policy expectations, particularly following weak July US jobs data that led markets to scale back bets for a Federal Reserve interest rate hike next month.

Fawad Razaqzada noted that if the data continues to indicate a cooling economy without a meaningful resurgence in inflation, markets could further reduce expectations for tighter policy. This would leave the dollar vulnerable and provide another supportive backdrop for gold.