Gold prices edge higher as investors focus on US inflation data

Gold prices edged higher on Monday as investors looked forward to a key inflation report that could shed more light on the U.S. central bank's next policy move.

Spot gold was up 0.2% at $2,435.33 per ounce, US gold futures were flat at $2,474.20.

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"I don't think people will want to make big commitments ahead of the data," said Ilya Spivak, head of global macro, Tastylive.

The US consumer price index (CPI) data, due on Wednesday, is expected to show that headline and core prices rose 0.2% month-on-month.

"Further inflation progress reflected in the upcoming CPI data could see gold eye for a retest of its all-time high once more," said IG market strategist Yeap Jun Rong.

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Currently, the market sees a 54% chance of a 50-basis-point rate cut at the Federal Reserve's September meeting, according to the CME FedWatch Tool.

Non-yielding bullion's appeal tends to shine in a low interest rate environment.

Fed Governor Michelle Bowman softened her usually hawkish tone ever so slightly on Saturday, noting some further "welcome" progress on inflation even as she said inflation remains "uncomfortably above" the central bank's 2% goal.

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On the top side, resistance (for gold) seems to be around $2,480-$2,500, but gold will go higher ultimately, but there might be a lot of volatility in near term, Spivak added.

Elsewhere, Palestinian militant group Hamas on Sunday asked mediators to present a plan based upon previous talks instead of engaging in new negotiations for a Gaza ceasefire deal, raising doubts about its participation in Thursday's meeting.

Among other metals, spot silver rose 0.9% to $27.69 per ounce, platinum gained slightly above 1% to $931.55 and palladium was up by 0.7% to $911.75.