Gold moves in a positive zone as the dollar weakens

Gold prices rose in European trade on Monday to near a week high, while holding its ground above $2900 with the dollar weakening.

Now investors await US inflation data for February, expected to offer fresh pricing for the odds of a Fed rate cut in March.

The Price

Gold prices rose 0.35% today to $2918 an ounce, with a session-low at $2896.

Gold lost 0.1% on Friday on profit-taking away from a week high at $2930.

Gold rallied 1.8% last week, the ninth weekly profit in two and a half months on haven demand.

The Dollar

The dollar index fell 0.35% on Monday on track for the sixth loss in a row, plumbing a four-month trough at 103.46 against a basket of major rivals.

A weaker dollar makes greenback-denominated gold futures cheaper to holders of other currencies.

Investors are concerned that Donald Trump’s aggressive trade policies would hurt growth both in the US and globally.

US Rates

Fed Chair Jerome Powell said it remains to be seen whether Trump’s tariff plans will be inflationary. 

According to the Fedwatch tool, the odds of a Fed 0.25% rate cut in March stood at just 3%.

Now investors await important US inflation data this week to gather more clues.

The SPDR

Gold holdings at the SPDR Gold Trust fell 4.3 tons on Friday, the third drop in a row to a total of 894.34 tons, the lowest since February 20.