July 31 (Reuters) – Gold was headed for its first monthly gain in five on Friday, as investors assessed the impact of the U.S.-Iran conflict and parsed the Federal Reserve’s signals for clues on inflation and the path for interest rates.
FUNDAMENTALS
* Spot gold inched 0.2% lower at $4,096.29 per ounce, as of 0107 GMT, but was headed for a weekly rise of 1.1%. U.S. gold futures for August delivery gained 0.1% to $4,094.10.
* The metal was on track to gain more than 2.2% this month, its sharpest gain since February.
* Spot gold rose 2% on Wednesday, after the Fed left interest unchanged at its latest policy meeting, and Chairman Kevin Warsh gave little indication on the central bank’s next policy move.
* Markets are now pricing in a 63% chance of a rate hike in September, down from about 80% prior to the policy meeting, according to CME Group’s FedWatch tool. [FEDWATCH]
* The dollar gained about 0.3%, after diving 2.4% in its biggest single-day drop since January 2023 on Thursday. [USD/]
* A drone strike on gas vessels in Egypt’s Mediterranean port of Damietta signalled a potential new front in the U.S.-Iran war, raising the prospect of threats to navigation through the Suez Canal, one of the last remaining export routes for Saudi oil.
* U.S. inflation slowed in June, with the Personal Consumption Expenditures Price Index slipping 0.1% on a month-over-month basis, the weakest reading since April 2020, but the easing is likely to be temporary as renewed hostilities in the Middle East raise oil prices.
* Global gold demand was steady year-on-year at 1,268.9 metric tons in the second quarter of 2026 as central banks sped up purchases, offsetting a slump in investment, the World Gold Council said on Thursday.
* Spot silver held steady at $58.98 per ounce, platinum slid 1.3% to $1,638.97, and palladium fell 0.2% to $1,301.94.
DATA/EVENTS (GMT)
0600 UK Nationwide house price mm, yy Jul
0900 EU HICP Flash YY Jul
0900 EU HICP-X F, E, A, T Flash YY, MM Jul
1200 US U Mich Sentiment Final
(Reporting by Pablo Sinha in Bengaluru; Editing by Mrigank Dhaniwala)