Weakening Dollar and Falling Oil Prices Boost Gold
Precious metals registered a general upward movement as markets await US inflation data.
Gold started the week with an increase due to the weakening of the dollar and the decline in oil prices, while investors await this week's inflation data for clues regarding the Fed's interest rate policy.
Rise of Gold in Markets
Spot gold rose 0.3% to $4,206.01 per ounce, while US gold futures for December delivery also gained 0.3% to reach $4,230.40.
Spot gold hit its highest level since October 2 earlier in the session.
Impact of Oil and the Dollar
KCM Trade Chief Market Analyst Tim Waterer stated that the decline in oil prices, driven by expectations of an agreement between Russia and Ukraine to halt attacks on energy facilities, and the weakening of the dollar supported gold.
Waterer noted that the drop in oil prices eased concerns over inflation and interest rate hikes, thereby increasing the appeal of gold.
Developments in Ukraine and Russia
US President Donald Trump announced an energy ceasefire between Russia and Ukraine on Sunday, which he said would take effect immediately.
Ukrainian President Volodymyr Zelenskyy stated that they were still awaiting the details of the agreement, and oil prices declined amid expectations that Russia's supply would increase.
Expected Inflation Data
Markets are focused on the US consumer price index to be released on Wednesday, and the producer price index and retail sales data to be published on Thursday.
According to CME FedWatch data, investors are pricing in a 17% probability of an interest rate hike in October and an 86% chance of a rate hike by December.
Other Precious Metals
US consumer confidence fell further in early October as conflicts in the Middle East increased the cost of living.
Among other precious metals, spot silver rose 0.5% to $61.12 per ounce, platinum advanced 1% to $1,704.70, and palladium gained 1.2% to $1,161.81.