Gold Edges Up with Focus on US Inflation Data
Spot gold was up 0.3% at $3,354.91 per ounce, as of 0453 GMT. US gold futures for December delivery were steady at $3,405.40.
Gold slipped 1.6% on Monday, while futures dropped by more than 2% after US President Donald Trump said tariffs will not be placed on imported gold bars, easing jitters in the market.
"Market participants now will be definitely focusing on the upcoming Fed rate cut, which has been more or less priced in for September. If we start to see the core CPI data came in slightly below expected, that could actually further support this rate-cut expectations," OANDA senior market analyst Kelvin Wong said.
"That could lower the cost of holding gold and the long-term US 10-year treasury yield still remains below certain key resistance level, so that could actually support gold prices."
All eyes are on US consumer prices index data, which is due at 1230 GMT. Economists polled by Reuters projected that core CPI likely rose 0.3% in July, pushing the annual rate higher to 3%, away from the Fed target of 2%.
Traders are pricing in around an 85% chance of a Fed rate cut next month, as per the CME FedWatch Tool. Gold tends to perform well during periods of uncertainty and in a low-interest-rate environment.
Traders appeared to show scant reaction to a statement from a White House official that Trump signed an executive order on Monday, extending a pause in sharply higher US tariffs on Chinese imports for another 90 days.
Elsewhere, spot silver gained 0.7% to $37.88 per ounce, platinum rose 0.3% to $1,330.25 and palladium climbed 0.9% to $1,145.47.
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