Gold Rises as Dollar Weakens and Rate Hike Chances Plummet

Gold prices have risen for the second day in a row as the US dollar weakens and expectations of an interest rate hike by the Federal Reserve decline. Spot gold prices increased by 0.4% to $4,391.07 per ounce, while futures contracts rose by 0.3%. The precious metals sector as a whole saw gains, with silver rising 1.4%, platinum up 0.3%, and palladium increasing by 1.6%. A weaker dollar makes gold more attractive for holders of other currencies, contributing to the price increase.

The recent US economic data has confirmed a slowdown in inflationary pressures, leading to reduced expectations of an interest rate hike at the upcoming September meeting. The probability of a rate hike has dropped from 47% last month to just 30%, according to FedWatch. Investors are now looking forward to the release of the minutes from the Federal Reserve's July meeting this Wednesday for any new indicators or signals on future monetary policy.