Gold Rebounds to $4,192 as Dollar Weakens

Gold Rebounds to $4,192 as Dollar Weakens

At 00:32 ET (04:32 GMT) spot gold (XAU/USD) rose 0.5% to $4,191.76 an ounce, while gold futures (GC) gained 0.6% to $4,215.87. Silver (XAG/USD) advanced 0.3% to $60.50 an ounce, platinum (XPT/USD) climbed 0.3% to $1,697.26, and palladium (XPD/USD) rose 0.4% to $1,147.50. The U.S. Dollar Index slipped 0.2% to 102.43, providing support for bullion.

Earlier in the Asian session spot gold was quoted at $4,156.27 an ounce; silver was down 0.5% at $59.93 an ounce, with both platinum and palladium also declining.

Gold had traded near $4,160 an ounce after ending the previous session 0.5% lower. Brent crude approached $106 a barrel as Iran‑backed Houthi forces attacked Saudi Arabia’s main airport, heightening concerns over regional energy‑supply disruptions. The spreading conflict has raised fears that further oil‑price spikes could prolong inflationary pressures. Since the U.S.–Iran war began in late February, gold has fallen roughly one‑fifth, reflecting heightened global inflation concerns and tighter monetary policy.

Higher borrowing costs typically weigh on gold because the non‑yielding metal becomes less attractive relative to interest‑bearing assets. Persistent inflation and heavy government borrowing have kept interest rates and bond yields elevated, further limiting bullion’s appeal.

Traders are focused on U.S. consumer‑price‑index (CPI) data due on Wednesday, viewing it as a key catalyst for precious metals. Market pricing implies roughly a 20% probability of another Fed rate increase at the October meeting and anticipates one additional hike before year‑end.

Federal Reserve Bank of Cleveland President Beth Hammack said on Monday that smaller, more frequent adjustments to monetary policy could help anchor inflation expectations, but she stopped short of endorsing an October rate hike. Her comments come as policymakers grapple with persistent inflation risks and elevated borrowing costs, with further energy‑price spikes potentially reinforcing expectations for higher rates.

In summary, the weaker dollar and ongoing Middle‑East tensions have lifted gold prices, while investors await U.S. inflation data to gauge the likelihood of further Federal Reserve tightening.