BENGALURU- Gold prices eased on Tuesday as profit-taking kicked in after bullion hit a more than one-week high, while market players awaited key US inflation data that could provide further insight into the Federal Reserve’s next policy decision.
Spot gold fell 0.4 percent to $2,462.19 per ounce, after hitting its highest level since Aug. 2 earlier in the session. Prices rose more than 1 percent in the previous session.
US gold futures were little changed at $2,502.40.
“Gold had a solid start to the week though it eased moderately on some gentle profit-taking,” said Tim Waterer, chief market analyst, KCM Trade.
“Prices will benefit if the US inflation data comes in on the softer side of the ledger, which would reignite hopes of an aggressive rate cut from the Fed in September.”
Traders are waiting for July US producer price figures due later in the day and consumer price (CPI) numbers on Wednesday to gauge the chance of outsized rate cuts. The CPI data is expected to show that headline and core prices rose 0.2 percent month-on-month.
Markets see about 50 percent chance of a 50 basis point rate cut in September, according to the CME FedWatch Tool. A low interest rate environment tends to boost non-yielding bullion’s appeal.
