Gold prices edge up after sharp losses; US inflation data awaited

Investing.com-- Gold prices edged higher in Asian trading on Tuesday after a sharp decline in the previous session, as investors cautiously await key U.S. inflation data amid rising hopes for Federal Reserve easing.

Spot Gold edged 0.3% higher to $3,353.87 an ounce, while Gold Futures for December were largely steady at $3,403.25/oz by 02:03 ET (06:03 GMT).

Gold prices fell 1.6% on Monday, and futures dropped more than 2% after U.S. President Donald Trump said gold bars would not face tariffs, easing supply concerns.

US CPI data on tap amid Fed rate cut bets

The U.S. consumer price index data is due later on Tuesday, followed by the producer price report later in the week, both closely watched for clues on the Fed’s policy path amid expectations of a September rate cut.

Analysts expect core consumer inflation to have risen 0.3% in July, lifting the year-over-year rate to around 3.0%, well above the Federal Reserve’s 2% target.

Strong inflation readings could dampen hopes for an early rate cut by the Fed. 

“We think an upside surprise is likely because the tariffs start passing through,” ING analysts said in a note.

Markets currently assign roughly an 87% probability to a cut, according to the CME FedWatch tool.

Gold prices fell sharply in the previous session as Trump cleared speculation around tariffs on the yellow metal.

At the same time, an extension of the U.S.–China tariff truce by another 90 days reduced geopolitical risks, easing pressure on risk assets and dampening the safe-haven allure of gold. 

Metal markets rise, silver up 0.5%

Other precious metals also edged higher on Tuesday as Fed rate cut bets and a weaker dollar lent support.

Platinum Futures rose 0.2% to $1,344.20/oz, while Silver Futures gained 0.5% to $37.968/oz.

Benchmark Copper Futures on the London Metal Exchange rose 0.4% to $9,768.65 a ton, while U.S. Copper Futures advanced 0.5% to $4.466 a pound.