Gold prices edged higher in Asian trading on Tuesday, recovering slightly after touching weekly lows, as traders shifted focus to upcoming United States inflation data.
By 3:25 pm AEST (5:25 am GMT), spot gold was up $21.52 or 0.7% at $3,257.23 per ounce.
The yellow metal found support as the U.S. dollar eased, with investors reassessing the recent U.S.-China trade truce and recalibrating expectations for Federal Reserve policy moves.
Over the weekend, Washington and Beijing reached a temporary agreement to reduce tariffs during a 90-day negotiation period - the U.S. cutting duties from 145% to 30%, and China from 125% to 10%.
This easing tensions briefly boosted risk sentiment and trimmed fears of a near-term U.S. recession, strengthening the dollar and weighing on gold, a traditional safe-haven asset.
Additional geopolitical relief - including a ceasefire between India and Pakistan and hopes for progress in Thursday’s Russia-Ukraine peace talks - also curbed gold’s appeal.
Meanwhile, gold has also been supported by profit-taking in long U.S. dollar positions as attention turns to Wednesday’s consumer price index (CPI) release.
The data is expected to show annual headline inflation holding steady at 2.4% in April, with core inflation seen unchanged at 2.8%.
