Gold dips as dollar edges up; U.S. inflation data awaited

Gold prices retreated from their highest level since early September on Tuesday amid a slightly firmer dollar, as investors awaited U.S. inflation data scheduled for later in the week.

Spot gold fell 0.1% to $1,822.30 per ounce by 10:17 a.m. ET, having earlier recorded its highest since Sept. 3 at $1,830.35

U.S. gold futures fell 0.3% to $1,822.70

“Investors are cautious near $1,830-$1,835 as we have not been able to breach that to the upside in July and August,” said Phillip Streible, chief market strategist at Blue Line Futures in Chicago

Key central banks last week indicated interest rates would remain low in the near term, boosting the appeal of non-yielding gold and helping the metal post its best week since late August

However, a tight U.S. labour market and the dislocation in global supply chains could result in a high reading for U.S. consumer prices due on Wednesday

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“If the market sees the consumer price index number is above expectations then the argument will certainly go that the Federal Reserve must now hike quicker,” Quantitative Commodity Research analyst Peter Fertig said. But “the Fed is not following a rule book,” he added

The U.S. dollar, which gold has been tracking through the session, edged up against its rivals, making the bullion more expensive for holders of other currencies

Limiting losses in gold, yields on the 10-year Treasury notes slipped to 1.4427%

“Gold prices are on the cusp of a breakout,” TD Securities analysts said in a note. “Considering the extremely poor sentiment in precious metals across the last few months, the bar is low for prices to slice through trendline resistance