Gold Rises as Dollar Weakens, Fed Rate Hike Odds Ease

Gold prices ticked up 1% on Monday, bolstered by a weaker US dollar and easing expectations of Federal Reserve interest rate hikes. The precious metal market is awaiting further cues from the central bank's upcoming minutes.

The recent moderation in annual consumer and producer inflation across both headline and core measures in July has tempered Fed tightening expectations. According to the CME FedWatch tool, the probability of the central bank holding rates steady in September stands at about 63%, while the chances of a quarter-point hike are at nearly 37%.

Quarterly results from major US retailers will also provide insight into consumer health and the state of monetary policy. José Torres, senior economist at Interactive Brokers, stated: 'Retail earnings data to be released this week paired with minutes from the Federal Reserve's July meeting will offer significant clues about the health of the consumer as well as where the committee as a whole stands regarding monetary policy.'

Gold's gains on Monday were capped by rising oil prices, with Brent climbing above $90 a barrel amid tensions over the Strait of Hormuz. The advance came as the US and Iran continued to remain at loggerheads.