Gold Rises as Investors Anticipate Inflation Data

By Gina Lee

Gold prices rose on Tuesday morning in Asia as the dollar showed signs of weakening, prompting investors to look ahead to upcoming inflation data.

As of 12:50 AM ET, gold was up 0.24% to $1,863.89. The dollar, which typically moves in the opposite direction of gold, dropped slightly. The U.S. Federal Reserve’s tightened monetary policy to combat inflation has led to five consecutive weeks of gains for the dollar.

Recently, the Fed announced its first half-point interest rate hike, while another central bank raised its interest rate to 1%, the highest level since 2009.

Expectations of further aggressive interest rate increases pushed the dollar index to a high of 104.19 overnight, marking a 20-year peak. However, Atlanta Fed President Raphael Bostic noted on Monday that he does not foresee a 75-basis-point rate hike, as there are indications that inflation might be cooling.

In the Asia Pacific region, China’s trade data released on Monday showed a year-on-year growth of 3.9% in April, the slowest rate since June 2020, with COVID-19 lockdowns impacting trade significantly.

Investors are now looking ahead to important economic indicators set to be released on Wednesday, including inflation figures and additional data slated for Thursday.

In other precious metals, silver increased by 0.99%, platinum gained 0.58%, and palladium rose by 2.18%.