Gold rose from last Friday's lows by taking advantage of the fall in the US dollar currency.
This week, market participants need to get ready with the Federal Reserve's (Fed) release data on inflation, namely the Consumer Price Index (PCE) this weekend.
Meanwhile, the price of gold is now at $2,327.19 which is a slight decrease of 0.31% since it opened at the beginning of the Asian trading session this morning. Meanwhile, the USD currency fell at a time when US Treasury bond yields were strong.
Market investors' appetite is now increasingly risk-averse and is driving them to switch to the gold metal. US Treasury bond yields were unchanged at 4.253%.
The US Dollar Index (DXY) was seen falling against a group of six major currencies by 0.26% to 105.53.
The US economic docket, PCE, which is the Fed's main guide in assessing inflation, will be published this Friday. If the numbers are in line with forecasts, it means the disinflation process is on the move and will raise expectations of an interest rate cut in September.
Investors have now increased their forecast to 66% for policy easing compared to the previous 59.5%.
In the meantime, San Francisco Fed President Mary Daly said the labor market is undergoing a change where further weakness means the unemployment figure is getting higher. His dovish speech warned that inflation is not the only risk the Fed faces.
The December 2024 Fed funds futures contract implies the Fed will ease its policy by 36 basis points by the end of the year.
