Gold climbs to more than three-month high as markets await US inflation data

Gold rose to its highest in more than three months on Monday, building on gains from last week as a muted dollar boosted appeal, while investors awaited U.S. inflation data and remarks from Federal Reserve Chairman Kevin Warsh this week for signals on the interest-rate path. Spot gold was up 1% at $4,649.08 per ounce by 1004 GMT, hitting its highest level since May 15, while U.S. gold futures rose 0.6% to $4,706.20. Bullion rose more than 5% last week after the U.S. Treasury Department's buyback support plan pushed the dollar lower, making greenback-priced bullion more affordable for foreign investors. "The consolidation of gold prices above $4,600, and the potential for further gains, will depend to a large extent on the U.S. dollar remaining under pressure and Treasury yields stabilizing at current levels or declining further," ActivTrades senior analyst Ricardo Evangelista said. The dollar was pinned near multi-month lows on Monday. Market participants are now awaiting the July Personal Consumption Expenditure price index due on Wednesday and Warsh's speech at the Jackson Hole Symposium on Friday to gauge the policymakers' outlook on interest rates. Traders are pricing in about a 36% chance of a rate-hike in September, with a 64% chance of the Fed leaving rates unchanged, according to the CME FedWatch Tool. Although gold is typically seen as an inflation hedge, higher interest rates tend to diminish bullion's appeal due to its non-yielding characteristic. On the geopolitical front, the U.S. threatened Iran with what it called "the greatest financial offensive ever marshalled" as it prepared to roll out economic sanctions targeting Iran's trade partners. Yet, oil prices slipped more than $1 a barrel as investors took profits ahead of an expected announcement from Washington. Spot silver held steady at $68.93 per ounce, platinum gained 0.1% to $1,880.17, and palladium dropped 0.4% to $1,344.35.