Gold to the highest level in a week as the dollar declines

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Gold prices rose to a one-week high on Tuesday as the dollar weakened after a slower-than-expected rise in US inflation led to uncertainty over the timeframe for the Federal Reserve to scale back monetary stimulus.

Spot gold rose 0.6% to $1,804.30 an ounce by 1800 GMT.

US gold futures rose 0.7% to settle at $1,807.10 an ounce.

The core US consumer price index rose 0.1% in August, missing expectations that indicated an increase of 0.3%, which negatively affected the US dollar. It was the smallest increase since February and followed a 0.3% increase in July.

The inflation data may reinforce the view that the US central bank may go slowly in ending economic support measures and keep interest rates low. Gold benefits from low interest rates because it reduces the cost of holding the precious metal, which does not generate returns.

Among other precious metals, palladium fell 5.12 percent to $ 1980.30 an ounce, its lowest level since July 2020, while platinum fell 1.7 percent to $ 944.26. Palladium losses since the beginning of September are about 20%.

Silver rose 0.57% to $23.85 an ounce.

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