The price of gold declined by about 0.15% after falling by 0.73% on Friday. Pressure on prices is exerted by the positive dynamics of the US currency, as well as the correction of positions by investors ahead of the release of US CPI data, which will help clarify the prospects for easing the Fed's monetary policy.
The US Dollar Currency Index (DXY), which tracks the dynamics of the dollar against six currencies (euro, swiss franc, yen, canadian dollar, pound sterling and swedish krona) rose by 0.21% to 101.40, making gold more expensive for other currency holders.
US CPI data for August will be released on Wednesday, and according to forecasts, the overall CPI increased by 0.2% on a monthly basis, which will lead to a decrease in the annual rate to 2.6% (the lowest value since March 2021). Experts said that if the inflation data turns out to be below expectations, this could give a boost to gold, but currently the growth of the US dollar limits the upward movement of the precious metal. A low interest rate environment tends to boost non-yielding bullion's appeal. According to the CME FedWatch Tool, markets see a 29% probability of a 0.5% rate cut in September (down from 30% the week before), and a 71% probability of a 0.25% rate cut (up from 70% the week before), with a 1% rate cut expected by the end of the year.
Some pressure on prices was also exerted by official Chinese data, which showed that the Central Bank held back on buying gold for its reserves for a fourth straight month in August.