Gold rises to three-month high as investors await US inflation data

Gold prices climbed to their highest level in more than three months on Monday, supported by a weaker US dollar as investors awaited key US inflation figures and signals from Federal Reserve Chair Kevin Warsh on interest rates.

Spot gold rose about 1% to $4,649.08 per ounce, reaching its highest level since May 15. US gold futures also gained, rising 0.6% to $4,706.20.

Gold had already gained more than 5% last week, helped by a US Treasury bond buyback plan that pressured the dollar. A weaker dollar makes gold, which is priced in US currency, cheaper for investors holding other currencies.

Investors are now focused on the US Personal Consumption Expenditures (PCE) price index, due Wednesday, which is closely watched as an inflation indicator. Markets are also awaiting Warsh's speech at the Jackson Hole Symposium on Friday for clues about the Federal Reserve's future interest-rate decisions.

Higher interest rates generally weigh on gold because the metal does not generate interest income. Traders currently see a 36% probability of a September rate hike, while there is a 64% chance that the Fed will leave rates unchanged.

Meanwhile, geopolitical tensions also remain in focus, with the United States threatening further economic sanctions against Iran.

Other precious metals were mixed: silver stood at $68.93 an ounce, platinum rose 0.1% to $1,880.17, while palladium fell 0.4% to $1,344.35.

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