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Gold edges higher as Strait of Hormuz delays keep traders cautious

XAU/USD was up 0.5% to $4,352, after bouncing from $4,316 lows, while the dollar stayed slightly supported ahead of US CPI.

Reported · Written up by our desk · Precious Metals

Gold prices edged higher at the start of the week, with XAU/USD rising 0.5% to $4,352 after bouncing off daily lows of $4,316. FXStreet attributed the move to lingering uncertainty around the planned reopening of the Strait of Hormuz, which faced delays tied to Iran's demands of the US.

The report said gold gains were capped by a modestly stronger Greenback, with the US Dollar Index up 0.14% to 99.75 as traders continued to digest recent FX interventions. Attention is now focused on upcoming US inflation data, with July CPI expected to ease to 3.4% year over year from 3.5%, and core CPI projected to slip to 2.5% from 2.6%.

FXStreet also pointed to the broader macro calendar, noting that the Producer Price Index is expected to cool after CPI, and Initial Jobless Claims for the week ending August 8 are forecast to rise to 201K from 199K. It added that while softer Nonfarm Payrolls last week trimmed Fed hawkish expectations, investors are still watching for labor market weakness that could allow for rate cuts.

The piece highlighted geopolitics as another cross-asset influence, saying oil prices have rallied as talks on reopening Hormuz continue but progress slows after Iran said the US should agree to Tehran's conditions. It cited West Texas Intermediate up nearly 6% to $81.54 per barrel, a development described as a headwind for gold.

Latest closeGold $4,292.00 ▲1.1%|Dollar index 99.98 ▲0.3%

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