Gold prices hit three-month high as dollar weakens

Gold prices climbed to their highest level in more than three months on Monday as a softer U.S. dollar boosted demand for the precious metal.

Gold prices climbed to their highest level in more than three months on Monday as a softer U.S. dollar boosted demand for the precious metal. Investors are also positioning themselves ahead of key U.S. economic data and remarks from Federal Reserve Chair Kevin Warsh later this week.

Spot gold gained 1.02% to reach $4,649.95 per ounce at around 11:34 am PST, according to data reported by Mettis Global.

The latest advance came as the U.S. dollar remained close to multi-month lows. Market sentiment has been influenced by uncertainty surrounding the U.S. Treasury’s plans to repurchase longer-dated government bonds, a development that has attracted increased attention from investors.

A weaker dollar generally provides support to gold because the metal is priced in U.S. currency. When the dollar loses value, gold becomes relatively less expensive for investors holding other currencies, potentially encouraging additional buying.

Investors Await Inflation Data

Market participants are now closely watching the upcoming U.S. inflation figures for clues about the Federal Reserve’s future monetary policy. Inflation data can have a significant impact on expectations for interest rates, which in turn influence the attractiveness of non-yielding assets such as gold.

Investors will also be monitoring comments from Federal Reserve Chair Kevin Warsh later in the week for indications about the central bank’s assessment of inflation, economic growth and interest-rate policy.

Any signs of a more accommodative monetary policy could further support gold prices, while stronger-than-expected inflation or a more hawkish stance from the Federal Reserve could put pressure on the precious metal.

Geopolitical Risks Remain in Focus

Geopolitical developments are also contributing to market uncertainty. The United States has threatened Iran with what it described as its “greatest financial offensive ever marshalled,” including sanctions aimed at entities and countries involved in Iran’s trade.

Such developments can increase demand for traditional safe-haven assets, including gold, as investors seek protection against heightened economic and geopolitical risks.

Other Precious Metals

Other major precious metals recorded mixed performance during Monday’s trading session.

Spot silver declined 0.3% to $68.76 an ounce, while platinum fell 0.5% to $1,868.03 per ounce. Palladium also edged lower by 0.3% to $1,345.87 per ounce.

The divergent performance across precious metals highlights the stronger investor demand currently supporting gold, particularly amid currency weakness, monetary-policy uncertainty and geopolitical concerns.