Gold prices reclaimed the $4,400 level as a weaker dollar provided support, though investors remain cautious ahead of upcoming U.S. inflation reports and the September Federal Reserve meeting.
The U.S. Dollar Index declined 0.2% to 98.70, providing a supportive environment for dollar-denominated commodities like gold and silver. The index remains a focal point for investors as they await U.S. inflation figures to gauge future Fed policy.
The U.S. Dollar Index is at 98.70, following a 0.2% decline.
Gold prices climbed 1.1% to $4,402.41 an ounce on Wednesday, snapping a three-session losing streak as the U.S. Dollar Index retreated 0.2%. Investors are balancing geopolitical tensions in the Middle East against a 60% market probability of a Federal Reserve rate hike in September, while awaiting critical U.S. inflation data to gauge future monetary policy.
Gold does not generate interest income, so higher interest rates and bond yields make interest-bearing assets more attractive to investors, often putting downward pressure on gold prices.