Gold Prices Rebound Ahead of US Inflation Data Release

Gold prices rose on Wednesday, nearing a 10-week high as markets anticipated key US inflation data.

Spot gold gained 0.6 percent to $4,391.82 per ounce, while US gold futures for December delivery rose 0.2 percent to $4,451.90. The rebound follows a period of reduced bets on Federal Reserve tightening next month. Bullion had previously climbed to a 10-week high on Tuesday before encountering technical resistance. The primary driver for gold's movement is the decrease in market pricing for rate hikes by the Federal Reserve, according to Kelvin Wong, a senior market analyst at Oanda.

Bullion posted its largest weekly gain since January last Friday after weaker-than-expected jobs data led traders to scale back expectations for US rate hikes. Traders are now pricing in a 50 percent chance of a hike in September, down from 60 percent prior to the jobs report. Lower interest rates generally support gold prices as bullion does not yield interest.

The upcoming US Consumer Price Index data is expected to influence the interest rate outlook. Fed Bank of Chicago President Austan Goolsbee stated his greater concern is with high inflation rather than labor market weakness. In other commodity markets, Brent crude oil extended gains amid reports of separate shipping attacks and dimming prospects for ending the Iran war. Spot silver was up 0.8 percent at $65.20 per ounce, platinum rose 0.2 percent to $1,748.03, and palladium gained 0.8 percent to $1,370.75.