Gold edges up on Mideast conflict

Gold prices edged up on Monday as an escalation in the Middle East conflict pushed investors to safe haven assets, while traders awaited inflation data this week for further clues on the Federal Reserve's rate cut path, reports Reuters.
Spot gold was up 0.2 per cent at $2,658.07 per ounce by 1130 GMT. US gold futures edged up about 0.4 per cent at $2,677.90.
"Gold prices are caught in a tug of war between a strengthening US dollar and ongoing safe-haven demand, likely keeping them near current levels. Upcoming US economic data may be the deciding factor in breaking this stalemate," said Ricardo Evangelista, senior analyst at ActivTrades.
The market now awaits minutes of the Fed's last policy meeting and U.S. Consumer Price Index and Producer Price Index data this week.
"This week's CPI data is crucial for anticipating what the Fed would do, but I'm not expecting a surprise because the market is already pricing an almost 100 per cent chance that the Fed will look at a rate (cut) by only 25 basis points," said Kinesis Money market analyst Carlo Alberto De Casa.
Traders now see a 95 per cent probability that the Fed will cut rates by only a quarter of a percentage point next month, after a U.S. employment report on Friday pointed to a resilient economy that will probably prompt the central bank not to deliver large interest rate cuts for the rest of this year.
"The dollar recovering and going up wouldn't be a good scenario for gold but despite that bullion has managed to remain steady, confirming a strong interest of investors for bullion. Apart from that, geopolitical tensions have also supported gold demand," said De Casa.
Spot silver fell 0.6 per cent to $31.98, platinum lost 0.4 per cent at $986.15 and palladium rose 0.9 per cent to $1,020.78.