13.08.202613:31:39UTC+00Gold Hovers at 10-Week High

Gold traded around $4,400 an ounce, hovering near a 10-week high, as softer US inflation data strengthened expectations that the Federal Reserve will keep interest rates unchanged next month. US producer-price inflation slowed more than forecast in July, helped by lower energy and food costs, adding to evidence that overall price pressures are not reaccelerating.

At the same time, renewed tensions in the Middle East remain a key risk, as any disruption to supply could drive energy prices higher and reignite inflationary pressures. Oil is on track for a weekly gain while traders watch diplomatic efforts by the US and Iran to resolve the conflict and reopen the Strait of Hormuz.

Gold is also drawing support from robust investor demand and ongoing central-bank buying. China increased its gold reserves by about 20 tonnes in July, its 21st consecutive month of accumulation. Globally, central banks are estimated to have purchased 289 tonnes of gold in the second quarter.