Gold lingers near 7-week low ahead of US economic data

Business Recorder reported that gold edged up on Tuesday but stayed close to its lowest level in more than seven weeks, as traders weighed the chance that the Federal Reserve keeps borrowing costs high for longer. Spot bullion gained 0.4% to $4,130.58 an ounce by 0407 GMT, having touched its weakest point since August 5 in the previous session. US gold futures, meanwhile, slipped 0.2% to $4,162.20.

Geopolitics remained in focus as US and Iranian officials each held separate discussions with mediators, part of a fresh attempt to bring an end to a seven-month conflict. Crude prices climbed for a second consecutive session, driven by unease over supply disruption in the Middle East. Higher energy costs can feed inflation and push central banks toward tighter policy, a setting in which gold typically underperforms because investors tend to prefer interest-bearing assets.

Markets now price a 72.5% probability of a Fed rate increase in October, according to the CME FedWatch Tool, up from 57.6% a week earlier. Fed Governor Lisa Cook expects inflationary pressure to persist in the coming months, linked to AI-driven demand and dearer oil, although she did not go as far as signalling more hikes. Silver dropped 0.9%, reaching $60.42, while platinum slipped 1.3% to $1,697.71 and palladium declined 0.8% to $1,205.27. Figures on US consumer sentiment and vacancies come out later on Tuesday, with ADP employment, PCE and nonfarm payrolls to follow during the week.