Gold prices dip as traders await key US inflation data
Shafaq News/ Gold prices eased onTuesday as profit-taking kicked in after bullion hit a more than one-week high,while market players awaited key US inflation data that could provide furtherinsight into the Federal Reserve's next policy decision.
Spot gold fell 0.4% to $2,461.71 perounce by 0616 GMT, after hitting its highest level since Aug. 2 earlier in thesession. Prices rose more than 1% in the previous session.
"Gold had a solid start to theweek though it eased moderately on some gentle profit-taking," said TimWaterer, chief market analyst, KCM Trade.
"Prices will benefit if the USinflation data comes in on the softer side of the ledger, which would reignitehopes of an aggressive rate cut from the Fed in September."
Traders are waiting for July USproducer price figures due later in the day and consumer price (CPI) numbers onWednesday to gauge the chance of outsized rate cuts. The CPI data is expectedto show that headline and core prices rose 0.2% month-on-month.
Markets see about 50% chance of a 50basis point rate cut in September, according to the CME FedWatch Tool. A lowinterest rate environment tends to boost non-yielding bullion's appeal.
"If markets become moreoptimistic of a 50 bp cut coming to fruition, this could propel the gold priceto make a run at the $2,500 level," Waterer said.
On the geopolitical front, IsraeliPrime Minister Benjamin Netanyahu traded barbs with his defense minister,underscoring the deep internal splits that continue to plague the government asthe war in Gaza risks spilling out into a wider regional conflict.
Among other metals, spot silver fell1.3% to $27.64 per ounce, platinum edged 0.2% lower to $934.95 and palladiumshed 0.7% to $913.25.
(Reuters)
