Gold prices remained stable on Monday as attention turned to upcoming U.S. PCE data for insights into the Federal Reserve’s policy direction, while a stronger dollar limited gains.
Spot gold rose slightly by 0.1% to $3,373.49 per ounce at 11:51 a.m. ET (15:51 GMT), after reaching its highest level since August 11 on Friday. U.S. gold futures for December delivery remained unchanged at $3,418.60.
The dollar increased by 0.4% against other major currencies, making dollar-priced bullion more costly for international buyers.
“The market is digesting Powell’s remarks from Friday… as we await new data that might better indicate the possibility of a rate cut in September,” stated Peter Grant, vice president and senior metals strategist at Zaner Metals.
“I believe the summer lull is ending soon. Therefore, I expect the upward trend in gold to resume.”
Gold prices climbed to nearly a two-week high on Friday after Fed Chair Jerome Powell suggested a potential interest rate cut at the central bank’s meeting next month. Powell noted that risks to the job market are increasing, yet inflation remains a concern, and no decision has been made yet.
According to the CME FedWatch Tool, markets estimate an over 86% chance of a 25-basis point rate cut at the Fed’s September policy meeting.
Gold, which yields no interest, performs well in low-interest-rate environments.
Investors are now looking forward to the U.S. Personal Consumption Expenditures data, due on Friday, for more hints on the central bank’s prospective rate cut strategy. The data is expected to show core inflation reaching its highest since late 2023 at 2.9%.
In other markets, spot silver remained steady at $38.81 per ounce, following a near one-month peak on Friday.
Platinum fell by 1.7% to $1,338.62, and palladium decreased by 2.7% to $1,096.27.
