Gold rose on Tuesday but remained near a one-month low, as investors await U.S. economic data and comments from Federal Reserve officials for more clarity on the path of interest rates.
Spot gold rose 0.2% to $2,624.17 an ounce by 0155 GMT, after hitting its lowest level since October 10 on Monday. U.S. gold futures rose 0.5% to $2,630.10.
The U.S. dollar held near a four-month high as investors continued to pile into deals seen as benefiting from the incoming Donald Trump administration. A stronger dollar makes bullion less attractive to holders of other currencies. [USD/]
“Gold succumbed to the US dollar's purple spell in the aftermath of the election. The president-elect's policies appear to be a boon for the dollar and potentially, from an inflationary perspective, could slow the downward trajectory Fed rates in 2025,” said Tim Waterer, chief market analyst at KCM Trade.
Gold is seen as a hedge against inflation, but rising interest rates reduce the appeal of holding this asset without yield.
The market will focus on the October consumer price index on Wednesday, the producer price index and weekly jobless claims on Thursday, followed by retail sales and industrial production on Friday.
A host of U.S. central bank officials are also scheduled to speak this week, including Chairman Jerome Powell.
Potentially inflationary tariffs and Mr. Trump's immigration policies have reduced the odds of a rate cut in December to about 65%, down from nearly 80% a week ago, according to the CME's FedWatch tool. Group.
“There is still a fundamental path higher for gold, although that would require the dollar to lose some momentum. A weak inflation report would increase the chances of a rate cut in December , which could give gold some respite,” Mr. Waterer added.
Spot silver was little changed at $30.70 an ounce, platinum lost 0.2 percent to $962.80 and palladium was flat at $980.34.
