Gold Prices Today, August 11: Gold prices climbed to their highest level in more than two months on Tuesday, supported by a weaker US dollar and expectations that softer US economic data could give the Federal Reserve room to ease monetary policy.
Gold, silver prices todayAs of 6:00 am IST, spot gold was up 0.5 per cent, or USD 22.60, at USD 4,413.16 an ounce. Prices touched their highest level since June 5, marking a more than nine-week peak. Spot silver also gained 0.6 per cent, or USD 0.40, to trade above USD 66 an ounce.
In the domestic market, gold and silver futures were not trading at the time of writing. Gold futures had settled at Rs 1,53,147 per 10 grams, while silver futures settled at Rs 2,36,951 per kg.
Weaker US dollar supports gold prices
The US dollar was under pressure, with the dollar index, which measures the greenback against a basket of six major currencies, down 0.1 per cent at 99.75.
A weaker dollar typically supports gold prices because bullion becomes cheaper for buyers holding other currencies. Gold is also often viewed as an alternative store of value when concerns about economic growth or monetary policy rise.
Softer US jobs data boosts rate-cut expectations
Gold has also benefited from weaker-than-expected US economic data released last week. On Friday, data showed that US nonfarm payrolls recorded their first monthly decline since February, while payroll figures for May and June were revised sharply lower.
The softer labour-market readings reinforced expectations that the Federal Reserve could adopt a more dovish monetary policy stance, providing further support to non-yielding assets such as gold.
Market expectations for a rate hike at the next Federal Open Market Committee (FOMC) meeting have also eased, with the probability falling to around 65 per cent from about 70 per cent earlier.
US CPI, PPI data in focus
Investors will now turn their attention to key US inflation data due later this week for fresh clues on the Federal Reserve’s monetary policy outlook.
The July consumer price index (CPI) is scheduled for release on Wednesday, followed by the producer price index (PPI) on Thursday. The readings could influence expectations around the Fed’s next policy moves and, in turn, determine the near-term direction of gold prices.
UBS sees gold at USD 5,000 by H1 2027
On the outlook for bullion, UBS said in a note on Friday that it expects gold prices to rise to USD 5,000 an ounce in the first half of 2027, while cautioning that near-term risks remain, Reuters reported.
The combination of a softer US dollar, weaker labour-market data and shifting expectations around Federal Reserve policy has kept the outlook for gold prices constructive, although upcoming inflation data could trigger increased volatility.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money-related decisions.)
