Ammon News - Gold prices edged higher ​on Monday as softer oil prices offered support, while investors assessed ‌the chances of a Federal Reserve interest rate hike later this year.

Spot gold rose 0.4% to $4,182.30 per ounce by 0455 GMT, while US gold futures for December delivery gained 0.5% to $4,203.50.

"Gold is ​posting a modest rise to start the week. The metal is ​responding positively to the softer tone in oil prices from an ⁠inflation standpoint," said Tim Waterer, chief market analyst at KCM Trade.

"In the near ​term, a more sustained decline in oil prices or a clearer move lower ​in (US Treasury) yields would be the most constructive catalysts, as both would ease inflation and rate concerns."

Oil prices slipped on Monday after US President Donald Trump waived sanctions and tariffs on Russia ​that may lead to more Russian fuel exports.
US import prices increased more than expected ​in September, boosted by higher costs for energy products and a range of other goods, ‌further ⁠evidence of rising inflation pressures.

Market participants now await the Federal Open Market Committee's meeting on US interest rates and the Personal Consumption Expenditures (PCE) data due next week. The US central bank tracks the PCE price measures for its 2% inflation target.

According ​to the CME's ​FedWatch Tool, traders ⁠are pricing in a 13% chance of a rate hike this month and an 89% chance of an increase in ​December.
While gold is typically considered a hedge against inflation, ​higher interest ⁠rates reduce the appeal of the non-yielding asset.

Elsewhere, the European Central Bank is likely to raise interest rates by 25 basis points at least one more time this year ⁠to ​fight inflationary pressures, the International Monetary Fund said ​on Friday.

Among other metals, spot silver rose 1.3% to $57.73 per ounce, platinum gained 1.1% to $1,647.75 and palladium climbed 1.7% to $1,131.29.


Reuters