Gold prices saw an increase on Tuesday as investors awaited key U.S. inflation data, which could provide further insight into the Federal Reserve‘s interest rate cut timing.
In Saudi Arabia, 24-carat gold saw a 0.39 percent increase to SAR282.73 per gram and SAR8,793.84 per ounce.
Globally, spot gold saw a 0.35 percent rise to $2,344.59 per ounce, as of 5:01 GMT, after falling around 1 percent on Monday. Meanwhile, U.S. gold futures saw a 0.26 percent increase to $2,349.15.
Weak inflation data to propel gold prices
As investors look for further clues on the Federal Reserve’s interest rate policy, they currently await the release of key U.S. data, including the U.S. Producer Price Index (PPI) data, on Tuesday, and the Consumer Price Index (CPI) data due on Wednesday.
With inflation remaining stubborn, weaker CPI data could propel gold prices toward all-time highs in the short term, analysts believe. Gold prices continue to be supported by concerns surrounding stagflationary risks, despite the decreased opportunity cost associated with holding gold amid high interest rates.
Moreover, the recent weak jobs report and softer-than-expected U.S. payrolls data in April have heightened expectations for rate cuts by the Federal Reserve, potentially influencing gold prices in the coming months.
Read: Oil prices surge as China’s fiscal stimulus, Canadian wildfires threaten supply
Other precious metals
In addition to gold prices, other precious metals also experienced gains. Spot silver rose by 0.87 percent to $28.44 per ounce, while platinum gained 0.14 percent to $998.15, after hitting almost a one-year high on Monday, and palladium rose 0.63 percent to $966.71.
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