Gold regains ground as dollar, yields slip post US PPI data

Gold is seen as a hedge against inflation, but higher interest rates increase the opportunity cost of holding non-yielding bullion.

The dollar fell 0.2% against its rivals after an initial jump following the U.S. data, making gold less expensive for other currency holders. Benchmark 10-year Treasury yields also crept lower. [USD/]

Meanwhile, Federal Reserve Chair Jerome Powell said he expects U.S. inflation to continue declining through 2024 as it did last year and noted it was unlikely the Fed would have to raise interest rates again.

Focus now shifts to Wednesday’s U.S. consumer price figures that could provide more clarity on Fed rate cuts this year.

Elsewhere, spot silver rose 1.1% to $28.49 per ounce and palladium gained 1.9% to $978.75.

Platinum was up 3.1% to $1,028, its highest level in a year.

"We expect platinum to outperform on rising autocatalyst demand, greater potential for investment inflow, and capex tightening in the South Africa PGM mining industry which could disproportionately impact platinum supply," Deutsche Bank wrote in a note.