Palladium rises nearly 2% ahead of US inflation data

Palladium prices rose on Tuesday even as the dollar gained ground against most major rivals and ahead of crucial US inflation data.

Now investors await important US inflation data later this week to get clues about the likely path ahead for monetary policies. 

According to a Reuters survey, US inflation was up 0.6% m/m in August, compared to 0.2% in July. 

Later this month, the Federal Reserve is holding its periodic policy meeting, expected to hold interest rates unchanged.

Otherwise, the dollar index rose 0.2% as of 16:17 GMT to 104.8, with a session-high at 104.9, and a low at 104.4.

As the dollar strengthens, prices of dollar-denominated metals futures suffer as they become costlier to holders of other currencies. 

Palladium futures due in December rose 1.7% as of 16:18 GMT to $1240 an ounce.