Gold Steady as Markets Eye US Inflation Data for Fed Rate Cues

Gold prices were little changed in early Asian trading on Monday, as market participants turned their attention to crucial US inflation data due later this week for fresh clues on the Federal Reserve's interest-rate trajectory.

Spot gold hovered near $4,424.40 per ounce, while US gold futures for December delivery edged down 0.1% to $4,471.60.

The precious metal slipped on Friday after data showed US job growth accelerated sharply in August, with the unemployment rate holding steady at 4.1%. The stronger-than-expected labour market report has kept the possibility of a rate hike at the Fed's September 15-16 meeting firmly on the table. According to CME's FedWatch tool, traders currently price in a 58% chance of a rate increase at that meeting.

While gold is traditionally seen as a hedge against inflation, higher interest rates tend to diminish the appeal of non-yielding bullion. The upcoming US consumer and producer inflation reports are expected to provide further direction on the Fed's policy path.

In other metals, spot silver was flat at $66.21 per ounce, platinum slipped 0.7% to $1,807.38, and palladium declined 0.4% to $1,393.00.

On the macroeconomic front, US President Donald Trump reiterated his criticism of the Fed, saying on Friday that unless the central bank cuts rates, he would stop trading with countries where the US runs a deficit. Meanwhile, Bank of England Governor Andrew Bailey attributed rising public debt across advanced economies to weak productivity and shocks such as COVID-19, which in turn is pushing up borrowing costs.

In physical market news, Perth Mint reported that its gold product sales in August fell to a three-month low, while silver sales dropped more than 31% from the previous month.