FX.co ★ Gold Edges Lower on Dollar Strength

Gold retreated toward $4,150 an ounce on Tuesday, marking a second consecutive decline as the US dollar climbed to an 18‑month high ahead of pivotal inflation data that could influence the Federal Reserve’s next interest rate decision. The US consumer price index is scheduled for release on Wednesday, followed by producer price data on Thursday. Current market pricing suggests roughly an 80% probability that the Fed will keep rates unchanged this month, alongside nearly an 88% chance of a rate hike in December.

Investors also tracked geopolitical developments, with the US considering joining Saudi Arabia’s campaign against Iran-backed Houthi militants in Yemen, and the recently announced Russia‑Ukraine “energy ceasefire” already breached. These factors have helped keep oil prices elevated, intensifying inflation concerns and reinforcing expectations of additional interest rate increases.