Gold prices rose on Thursday, approaching $4,420 an ounce as the U.S. dollar weakened ahead of inflation data that could affect expectations for the Federal Reserve’s next interest-rate decision.
At 02:40 ET (06:40 GMT), spot gold, or XAU/USD, gained 0.4% to $4,418.87 an ounce, while gold futures rose 0.03% to $4,461.82.
Silver, or XAG/USD, increased 0.5% to $67.62 an ounce, while platinum, or XPT/USD, declined 0.6% to $1,889.34. The U.S. Dollar Index edged lower to 98.74.
Higher U.S. Treasury yields and developments in the Middle East remained among the factors being monitored by precious metals markets.
U.S. Treasury Yields Rise
Gold has traded around $4,400 in recent weeks after recovering from levels near $4,000 in July, as markets reassessed expectations for U.S. monetary policy.
U.S. 10-year Treasury yields increased after the government’s latest plan to purchase as much as $6 billion of longer-dated debt. Higher bond yields can increase the opportunity cost of holding assets such as gold that do not pay interest.
Energy prices also remained elevated, with Brent crude reaching $100 a barrel for the first time since July.
The supplied information said the conflict involving the U.S. and Iran was in its seventh month. Iran has said it is prepared for an escalation if the United States continues attacks on Iranian territory and infrastructure.
U.S. PPI and CPI Data in Focus
Markets are awaiting Thursday’s U.S. Producer Price Index and Friday’s Consumer Price Index ahead of the Federal Reserve’s next policy meeting.
Swaps markets were pricing in approximately a 65% probability of an interest-rate increase this month, according to the supplied information.
Tony Sycamore, senior market analyst at IG, said gold ended the previous session higher at around $4,402, with the weaker dollar providing support despite an increase in U.S. bond yields.
Sycamore also noted that gold remained below its 200-day moving average of approximately $4,537. According to his technical assessment, a move back above that level would be required to indicate that the decline from the $4,697 high had ended and the broader upward trend had resumed.
Technical analysis represents an analyst’s interpretation of historical price movements and does not establish future price direction.
Gold ETFs Record $18 Billion of August Inflows
Global gold-backed exchange-traded funds attracted $18 billion of inflows during August, according to the World Gold Council, representing their second-largest monthly inflow on record.
ETF gold holdings increased by 121 tonnes to a record 4,189 tonnes, while assets under management rose 16% to $615 billion.
North American gold funds recorded their third-largest monthly inflow on record, while European-listed funds registered their largest monthly inflow, according to the World Gold Council.