Weaker Dollar Lifts Gold Prices Amid US Inflation Data Uncertainty
Gold prices edged higher on Thursday, driven by a weaker US dollar. The precious metal rose to $4,412.84 per ounce, up 0.3% from the previous day.
Market participants are waiting for key US inflation data releases, which could influence the Federal Reserve's interest rate path. The data includes the producer price index on Thursday and consumer inflation figures on Friday.
Marex analyst Edward Meir noted that geopolitical developments in the Persian Gulf are secondary to gold prices, which are currently driven by a weaker dollar. He added that the dollar is not increasing despite higher US rates.
The CME FedWatch Tool shows markets pricing in a 60% chance of a US rate increase this month. Higher rates typically make non-yielding assets less attractive to investors.