On COMEX, gold futures were trading at $4,484.30 per ounce, up $64.60 or 1.46% from the previous close. The contract touched an intraday high of $4,485 an ounce and a low of $4,443.20 an ounce.
Silver also moved higher, with COMEX silver rising 2.03% to $66.595 per ounce. The contract hit a high of $66.60 an ounce during the session.
Why are gold prices rising?
The latest leg-up in bullion comes amid growing expectations that the US Federal Reserve could ease monetary policy. Gold typically benefits from lower interest rates because it does not pay interest, making it relatively more attractive when yields on interest-bearing assets fall.
Markets have reassessed the US rate outlook after weaker-than-expected labour market data. The US economy lost 23,000 jobs in July, while the unemployment rate eased to 4.1% from 4.2% in June.
The data has reduced expectations of another rate increase and shifted attention towards the Fed’s next policy moves.
At its July meeting, the Fed kept interest rates unchanged, although three officials dissented in favour of a rate hike.
US inflation data in focus
The next major trigger for bullion markets will be US inflation data.
The US consumer price index (CPI) data is due on Wednesday (August 12), followed by producer price index (PPI) data on Thursday (August 13).
Investors will look for signs of whether inflation is cooling enough to give the Fed more room to adjust interest rates. A softer inflation reading could strengthen expectations of lower rates and support gold prices, while a stronger-than-expected reading could put pressure on those expectations.
Geopolitical risks add to bullion demand
Geopolitical uncertainty is also keeping investors cautious.
US President Donald Trump has responded to Iran’s conditions for a potential peace deal with demands for compensation linked to people killed in wars, attacks and protests. The escalation could complicate efforts to reopen the Strait of Hormuz, a critical route for global energy shipments.
Such uncertainty can support demand for gold as investors seek assets that can offer protection during periods of market and geopolitical stress.
Silver outperforms gold
Silver has gained more than gold in percentage terms in Tuesday’s (August 11’s) session. COMEX silver was up about 2%, compared with a 1.46% rise in gold.
Meanwhile, Barrick Mining reported higher second-quarter profit, helped by elevated bullion prices, highlighting the impact of the stronger precious-metals price environment on mining companies.
What should investors watch next?
For gold and silver, the immediate focus remains on US inflation data and the Fed’s interest-rate outlook.
A combination of softer inflation and weaker labour-market conditions could strengthen the case for easier monetary policy, potentially supporting bullion. On the other hand, persistent inflation could limit expectations of rate cuts and trigger profit-taking after the recent rally.
Gold has already moved to its highest level in more than two months in the spot market, making upcoming US data particularly important for the next leg of the move.
-With Reuters inputs
