Gold climbs as weaker dollar and rate cut hopes lift demand

WEB DESK: Gold prices ticked up on Wednesday, supported by a softer US dollar after fresh inflation data strengthened expectations of a September interest rate cut. Traders also kept a close watch on upcoming US-Russia talks over the war in Ukraine. 

By 02:39 GMT, spot gold had risen 0.2 percent to $3,351.46 per ounce, while US gold futures for December delivery edged up 0.1 percent to $3,401.60. 

Tim Waterer, chief market analyst at KCM Trade, said the dollar’s decline gave gold a modest lift, keeping it near the $3,350 mark ahead of Friday’s meeting between US President Donald Trump and Russian President Vladimir Putin in Alaska. “If the meeting fails to bring progress on Ukraine, gold could push back towards $3,400,” he noted. 

The White House on Tuesday described the meeting as “a listening exercise” for President Trump, signalling that a swift ceasefire deal is unlikely. 

Rate cut hopes grow 

US Consumer Price Index (CPI) figures released on Tuesday showed prices rising 0.2 percent in July, after a 0.3 percent gain in June. Annual inflation stood at 2.7 percent. The data sent the dollar index lower, making dollar-priced gold more attractive for buyers using other currencies. 

Markets are now pricing in about a 90 percent chance of a Federal Reserve rate cut in September, with at least one more expected before year-end. Lower interest rates generally benefit non-yielding assets like gold. 

Meanwhile, the United States and China have extended their tariff truce for another 90 days, easing some trade concerns and averting steep new duties. 

Investors are now awaiting more US economic indicators later this week, including the Producer Price Index, weekly jobless claims, and retail sales. 

Elsewhere, spot silver rose 0.7 percent to $38.14 per ounce, platinum gained 0.4 percent to $1,341.80, and palladium added 0.3 percent to $1,132.89. 

Gold price in Pakistan

In contrast to the global uptick, gold prices in Pakistan fell for the third straight session on Tuesday, tracking the earlier dip in international rates.

According to the All-Pakistan Gems and Jewellers Sarafa Association (APGJSA), the price of gold dropped by Rs500 per tola, bringing it down to Rs358,300. The rate for 10-gramme gold also slipped by Rs429 to Rs307,184.

The decline follows Monday’s sharp drop of Rs3,600 per tola, when the metal closed at Rs358,800 in the domestic market. Internationally, APGJSA reported that gold stood at $3,356 per ounce, including a $20 premium, down $5 from the previous session.

Elsewhere, spot silver rose 0.7 percent to $38.14 per ounce, platinum gained 0.4 percent to $1,341.80, and palladium added 0.3 percent to $1,132.89. 

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