Gold's Slight Bounce Masks Ongoing Rate Hike Anxiety

Gold prices have rebounded slightly after two consecutive losses due to a weaker US dollar. On Tuesday, spot gold gained 0.6% to $4,429.89 an ounce in early Asian trading.

The dollar index fell by about 0.4%, making bullion cheaper for buyers using other currencies. This brief respite from the pressure on gold comes after Friday's jobs report showed US employers added 162,000 jobs in August, with unemployment holding at 4.1%.

Ole Hansen, a commodity strategist at Saxo Bank, noted that the stronger employment report lifted bond yields and reinforced expectations of a September rate rise. This has put pressure on gold and silver.

However, attention now turns to inflation data, with producer prices due on Thursday and consumer prices on Friday. A hotter reading would strengthen the argument for another increase in borrowing costs, potentially pushing Treasury yields and the dollar higher again.