Dollar Eases, Gold Prices Rise as Inflation Data Looms
Gold prices rose on Tuesday as the US dollar eased, making gold more affordable for holders of other currencies. The spot price of gold was up 0.3% at $4,418.79 per ounce.
The US dollar index slipped 0.3%, which contributed to the increase in gold prices. Investors are also awaiting key inflation data releases this week, with the US producer price index due on Thursday and the consumer price index scheduled for Friday.
Gold's appeal as an inflation hedge can be reduced by elevated interest rates, but the current 60% chance of a rate hike at the Federal Reserve's next policy meeting is seen as moderate. The European Central Bank is also expected to raise interest rates in December.
The geopolitical situation remains tense, with Iran threatening to retaliate against any new US attacks on its assets, including energy infrastructure across the Gulf.