Gold prices received a tiny boost from inflation data although an apparent pause in escalating tension between the U.S. and China put the brakes on a solid monthly rally.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange, rose $1.15, or 0.1%, to $1,538.05 a troy ounce by 9:15 AM ET (13:15 GMT).
The precious metal pulled away from the flat line after the Fed's preferred inflation indicator, the core PCE price index, rose less than expected in July. Subdued inflation has been one of the key factors mentioned by the Federal Reserve as justification for a looser stance on monetary policy.
Markets continue to price in an additional 25 basis point cut at the next policy decision in September. Lower interest rates lower the opportunity cost of holding the non-yielding precious metal.
Gold was on track for a nearly 7% monthly rise as the U.S. and China escalated their tariff war throughout August, but was noticeably flat for the last week as both countries appeared to downshift hostilities, putting the brakes on the rally in the safe-haven precious metal.
Source : Investing.com