Gold rises as dollar eases; US inflation data on radar - The Economic Times

AI desk brief

Gold edged 0.3% higher to $4,418.79/oz as the dollar slipped 0.3%, with the market positioning for Thursday’s U.S. PPI and Friday’s CPI prints. December U.S. gold futures were down 0.3% at $4,464.80, but the near-term driver remains whether incoming inflation data reshapes expectations for the Fed’s next move; CME FedWatch shows traders pricing a 60% chance of a rate hike at next week’s policy meeting.

The article highlights the familiar tug-of-war for bullion: a softer dollar supports non-U.S. buying power, but elevated rates remain a headwind for a non-yielding asset like gold. It also notes that gold dropped on Sept. 4 after stronger-than-expected U.S. jobs data, underscoring how quickly rate expectations can overwhelm inflation-hedge demand. Deutsche Bank’s call for the ECB to hike again in December adds to the broader global tightening backdrop, even as energy risks keep inflation concerns elevated.

Other precious metals participated in the move higher, with silver up 0.3% to $66.34/oz, platinum up 0.6% to $1,836.97/oz, and palladium up 0.9% to $1,401.47/oz. Near term, gold remains data-dependent: a hot CPI/PPI combination would likely reinforce rate-hike odds and cap rallies, while a softer inflation surprise could extend the dollar-driven bid. Geopolitical risk from renewed Iran warnings is an additional support layer, but macro data remains the main catalyst into next week’s Fed meeting.