Weaker Dollar and Soft Economic Data Fuel Gold Price Rise

Gold prices rose on Monday as a weaker US dollar and subdued economic data boosted expectations that the Federal Reserve may keep interest rates unchanged at its upcoming policy meeting.

The price of spot gold gained 0.4% to $4,391.07 per ounce by 0248 GMT, extending its recent momentum after reaching a more than two-month high during the previous week.

The dollar's decline provided additional support to bullion, making gold and other dollar-denominated commodities relatively cheaper for buyers using other currencies.

According to Tim Waterer, chief market analyst at KCM Trade, gold began the week with strong momentum due to weaker inflation data putting pressure on the dollar and creating room for bullion to approach the $4,400 threshold.

Market participants are closely watching the minutes of the Federal Reserve's July meeting, scheduled for release on Wednesday, for indications about policymakers' views on inflation, employment, and future monetary policy directions.