Gold moved higher on Thursday as a weaker U.S. dollar provided support ahead of inflation figures that could influence market expectations for the Federal Reserve’s next interest-rate decision.
At 02:40 ET (06:40 GMT), spot gold, or XAU/USD, rose 0.4% to $4,418.87 an ounce. Gold futures gained 0.03% to $4,461.82.
Among other precious metals, silver, or XAG/USD, advanced 0.5% to $67.62 an ounce, while platinum, or XPT/USD, fell 0.6% to $1,889.34. The U.S. Dollar Index edged down to 98.74.
The move in gold came as markets continued to assess higher U.S. Treasury yields and developments in the Middle East.
Gold Trades Around $4,400 After July Recovery
Gold has traded around the $4,400 level in recent weeks, having recovered from levels near $4,000 in July.
U.S. 10-year Treasury yields increased after a government plan to purchase as much as $6 billion of longer-dated debt. Rising bond yields can increase the opportunity cost associated with holding gold because the metal does not generate interest income.
Oil 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 had entered its seventh month. Iran has said it is prepared for a more intensive conflict if U.S. attacks on its territory and infrastructure continue.
Inflation Data Could Affect Fed Rate Expectations
Attention is now focused on the U.S. Producer Price Index scheduled for Thursday and the Consumer Price Index due on Friday.
The releases come ahead of the Federal Reserve’s next monetary policy meeting. Swaps markets were assigning an approximately 65% probability to an interest-rate increase this month, according to the supplied information.
Tony Sycamore, senior market analyst at IG, said gold ended the previous session at around $4,402, with the weaker U.S. dollar providing support even as bond yields increased.
Sycamore noted that the metal remained below its 200-day moving average of approximately $4,537. His technical assessment indicated that gold would need to move back above that level to signal an end to the decline from its $4,697 high and a resumption of the broader upward trend.
Technical analysis is an analyst’s interpretation of historical market data and does not establish how prices will move in the future.
Global Gold ETF Holdings Reach Record
Global gold-backed exchange-traded funds recorded $18 billion of inflows in August, their second-largest monthly inflow on record, according to the World Gold Council.
Holdings increased by 121 tonnes during the month to a record 4,189 tonnes. Assets under management rose 16% to $615 billion.
North American funds recorded their third-largest monthly inflow on record, while European-listed gold funds registered their largest monthly inflow, according to the World Gold Council.
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