Gold Dips as Market Eyes Tariffs, Inflation Data

Credit: Reuters

Spot gold fell 0.5% to $3,328.06 per ounce as of 0145 p.m. EDT (1745 GMT). U.S. gold futures settled 0.7% lower at $3,336.7.

The dollar ticked up 0.6%, making gold more expensive for holders of other currencies.

"I think the market continues to be focused on tariffs, keeping gold underpinned. I remain bullish on gold, even though we're well within the range that has been in place since the middle of May," said Peter Grant, vice president and senior metals strategist at Zaner Metals.

Over the weekend, U.S. President Donald Trump threatened higher tariffs, including 30% on imports from the European Union and Mexico.

Data out Tuesday showed the U.S. Consumer Price Index increased 0.3% last month, in line with expectations, after edging up 0.1% in May. That was the largest gain since January.

In a post on Truth Social, Trump said that since consumer prices were low, the Federal Reserve should bring down interest rates. He has insisted on cutting rates for some time now.

The Fed will likely be able to start cutting short-term borrowing costs by September, traders continued to bet after the data.

"Honestly, gold should be perkier. This seems to reinforce the view that we need a new driver to push gold back up past $3,400," said Tai Wong, an independent metals trader.

Investors await U.S. Producer Price Index data on Wednesday for guidance.

Gold, a safe-haven asset during times of economic and geopolitical uncertainty, tends to thrive in low-interest-rate environments, as it offers no yield.

Elsewhere, spot silver slipped 0.9% to $37.79 per ounce after hitting its highest level since September 2011 on Monday.

"My next objective on the upside for silver is at $41.61/oz. I think the market is going to view any setback as a buying opportunity," Grant said.

Platinum rose 0.6% to $1,371.49 and palladium added 0.5% to $1,198.97.

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