Gold Gains as Dollar Slips Amid US Inflation Uncertainty

Gold prices have gained traction as investors await key U.S. inflation data for direction. The U.S. dollar slipped, allowing gold to rise, while traders increased bets on a possible U.S. interest-rate hike following stronger August job growth and persistent inflationary risks from renewed U.S.-Iran tensions.

The U.S. unemployment rate remained steady at 4.1%, and markets are pricing a 60% probability of a rate hike at next week's Federal Reserve meeting, according to CME FedWatch. Higher interest rates generally weigh on non-yielding gold by increasing the opportunity cost of holding bullion.

Geopolitical risks remain supportive, with Iran threatening economic warfare against the United States and reporting an advanced missile launch toward U.S. warships, increasing concerns over further escalation and oil-driven inflation.