Gold Rises Amid Dollar Decline and Anticipation of Trump-Putin Meeting

SadaNews - Gold prices rose slightly on Wednesday, supported by a decline in the dollar following the release of moderate U.S. inflation data that bolstered bets on a rate cut in September, while investors await U.S.-Russia talks this week regarding the war in Ukraine.

Gold increased in spot transactions by 0.1% to $3349.83 an ounce, while U.S. gold futures for December delivery remained steady at $3398.90.

Tim Waterer, Chief Market Analyst at KCM Trade, stated: "The drop in the dollar has allowed for a modest recovery in gold prices, as the precious metal hovers around the $3350 an ounce mark ahead of the Trump-Putin meeting on Friday."

Waterer noted: "If the meeting in Alaska yields no results and the war in Ukraine continues, that could push gold back toward the $3400 per ounce level."

The White House explained on Tuesday that the summit between U.S. President Donald Trump and Russian President Vladimir Putin is “a listening exercise for the president,” signaling a reduction in expectations for a swift agreement to a ceasefire between Russia and Ukraine.

Data released on Tuesday showed that the U.S. Consumer Price Index rose by 0.2% in July, following a 0.3% increase in June. On a year-on-year basis, the index surged by 2.7%.

The dollar index fell, making dollar-denominated assets more attractive to holders of other currencies.

Markets are pricing in about a 90% chance that the Fed will cut interest rates in September, with at least one additional cut expected before the end of the year. Gold, which does not yield returns, benefits from a low-rate environment.

In the context of easing trade tensions, the U.S. and China have extended the tariff truce for an additional 90 days, preventing the imposition of triple-digit tariffs on each other’s goods.

Investors are currently awaiting more U.S. economic data later this week, including the Producer Price Index, weekly unemployment claims, and retail sales.

In other precious metals, silver rose in spot trading by 0.8% to $38.17 an ounce, while platinum decreased by 0.1% to $1335.82, and palladium remained stable at $1129.37.