Gold prices rose on Wednesday from their lowest levels in a month hit in the previous session, supported by a decline in the dollar and bond yields, ahead of the release of U.S. consumer price index data that may provide clues about the trajectory of interest rate hikes. By 06:44 GMT, spot gold increased by 0.3% to $1,930.37 per ounce, after dropping to its lowest since July 10 at $1,922 per ounce on Tuesday. U.S. gold futures also rose by 0.2% to $1,964.50 per ounce.
In other precious metals, spot silver increased by 0.7% to $22.91 per ounce, platinum rose by 0.7% to $906.46 per ounce, and palladium gained 0.5% to $1,226.03 per ounce. Baden Moore, head of commodities at the National Australia Bank, stated that for a sustainable recovery in gold, the market needs more certainty regarding U.S. interest rate cuts in 2024.
Earlier data showed that China's consumer price index shrank in July, highlighting the difficulties faced by the world's second-largest economy in reviving demand, along with increasing pressure on authorities to take additional measures for direct stimulus. Gold, seen as a hedge against economic risks, found support from renewed concerns about the largest economy in the world after Moody's downgraded several U.S. banks' credit ratings. As a result, long-term U.S. Treasury yields fell, making gold more attractive. The dollar index remained below the highest level recorded on Tuesday, decreasing by 0.2%.
