Soft US inflation data reduces Fed rate hike bets, weakening the dollar and lifting gold prices above $4,400.
Gold (XAU/USD) climbed over 1% to $4,422 on Monday, driven by a weaker US Dollar (USD) and lower Treasury yields. The move follows softer-than-expected inflation data last week, which dampened expectations for a hawkish Federal Reserve pivot.
The US Dollar Index (DXY) fell 0.37% to 99.53, supporting the precious metal’s rally. While the 10-year Treasury yield rose 2.5 basis points to 4.718%, it failed to cap gold’s advance toward $4,500. Long-dated yields, including the 30-year, hit 2007 highs amid concerns over US debt and persistent inflation.
Investors trimmed Fed rate hike bets after last week’s inflation prints, though geopolitical tensions, including stalled US-Iran talks, kept crude prices elevated. West Texas Intermediate (WTI) surged 2.30% to $84.35 per barrel.