Gold hikes on softer dollar ahead of U.S. inflation data

Gold prices on Tuesday stood at near a two-week high hit in the previous session, helped by a subdued dollar.

Spot gold hiked 0.1 percent to $1,725.70 per ounce, as of 0041 GMT.

U.S. gold futures inched lower 0.2 percent at $1,736.80.

U.S. consumer price data, due at 1230 GMT, is expected to show headline inflation increased 8.1 percent year-over-year in August versus 8.5 percent in July.

Higher interest rates spike the opportunity cost of holding the non-yielding bullion and boosts the dollar.

Germany’s economy, Europe’s largest, will contract next year as a dramatic rise in energy costs due to the war in Ukraine extinguishes the chances of recovery after pandemic-related lockdowns, according to a statement of the Ifo institute on Monday.

Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, was down 0.18 percent to 964.91 tons on Monday from 966.64 tons on Friday.

Trade in precious metals in London would be suspended on Sept. 19, the day of Queen Elizabeth’s funeral, according to The London Bullion Market Association statement on Monday.