Gold soars as dollar declines, investors await US inflation data

Gold prices rose with the decline of the dollar today, Tuesday, but the yellow metal is struggling to gain momentum, as investors warn against making big bets before the release of US inflation data, which may affect the course of the monetary policy of the Federal Reserve (US Central Bank).

By 0531 GMT, gold in instant transactions increased 0.2 percent to $ 1928.99 an ounce. US gold futures rose 0.2 percent to $1,934.60 an ounce.

According to “Reuters”, Matt Simpson, chief market analyst at City Index, said that gold received support from the decline in the dollar, with the Federal Reserve apparently indicating that it is at the end of the monetary tightening cycle, “but it seems that Investors bullish on gold prices are reluctant to over-commit themselves ahead of Wednesday’s US inflation report.

The dollar approached a two-month low on the prospect of a rate cut. A weaker dollar would make gold cheaper for holders of foreign currencies

Several Federal Reserve officials said on Monday that the US central bank will likely need to raise interest rates further to control inflation, but that the end of the current monetary policy tightening cycle is nearing.

According to CME Group’s Feed Watch service, investors expect by 95 percent that the US central bank will raise interest rates at its July meeting to a range of 5.25 to 5.5 percent while keeping them at this rate before they fall. Maybe in 2024.

Raising interest rates reduces the attractiveness of gold, which does not yield a return

The focus this week is on US CPI data due for release on Wednesday. The core consumer price index is expected to rise 0.3 percent month-on-month in June, according to a Reuters poll.

As for other precious metals, spot silver rose 0.7 percent to $23.27 an ounce. Platinum rose 0.5 percent to $931.40 an ounce. Palladium rose 0.6 percent to $1,247.28 an ounce.