Gold recovers from its early Wednesday morning dip on the release of unexpectedly milder inflation data, with DG spot gold gaining over $30 an ounce on the news. Investors continue to watch the conflict in the Middle East for direction.
June’s wholesale prices unexpectedly dropped primarily due to falling energy costs, per this morning’s Bureau of Labor Statistics report. The produce price index posted a 0.3% decline for the month, beating the forecast of an unchanged rate. Additionally, the May reading was revised lower, from an increase of 1.1% to 0.6%.
The PPI follows yesterday’s release of the June U.S. consumer price index which came in weaker than economists had estimated, easing some pressure that the Federal Reserve will need to hike interest rates sooner rather than later.
Even as the data came in, heightened tensions between the U.S. and Iran threatened to spur oil prices higher, with a trickle-down inflationary effect. Hawkish news on the war has weighed on gold prices in recent months as investors turned to the dollar as a hedge against uncertainty. A stronger dollar makes gold more expensive for holders of other currencies and pressures prices of the yellow metal.
August gold futures rose 1.6% Tuesday to settle at $4,069.70 an ounce on Comex, though the front-month contract lost 1.1% in the first two days of the week. Bullion slid 12% in June after dropping 0.8% in May and losing 1% in April. It decreased 7% in the first half of 2026 after rallying 64% last year. The August contract is currently down $2.90 (-0.07%) an ounce to $4066.80 and the DG spot price is $4060.60.
U.S. consumer prices declined in June for the first time in six years, according to the data released Tuesday by the Bureau of Labor Statistics. Core inflation, which excludes volatile food and energy costs, was unchanged for the month and rose 2.6% year-on-year. Economists had forecast increases of 0.2% and 2.9%, respectively. With food and energy, headline CPI was 3.5% for the 12-month period, compared with an expectation of 3.8%.
Meanwhile, the U.S. reimposed its blockade on Iran after the Islamic republic attacked ships in the Strait of Hormuz, a key transit point for much of the world’s oil supplies. Some economists have forecast that a resulting high oil prices may force the Fed to boost interest rates to combat inflation.
In testimony before Congress on Tuesday, new Fed Chair Kevin Warsh said policymakers have no tolerance for high inflation
Over 87% of investors tracked by the CME FedWatch Tool are betting on interest rates staying unchanged at the next policy meeting at the end of this month. They are now evenly divided on whether there will be a rate hike in September or if it will stay unchanged. The Fed has kept interest rates unchanged this year after three previous rate cuts. The Fed last month held interest rates steady at 3.5% to 3.75%, but signaled growing support for a rate hike in 2026.
Front-month silver futures rallied 2% Tuesday to settle at $59.10 an ounce on Comex, though the September contract retreated 1.8% in the first two days of the week. The most-active contract touched a record above $115 in January. Silver declined 21% in June after gaining 2.5% in May and losing 1.2% in April. It lost 15% in the first half of 2026 after rising 141% last year. The September contract is currently down $0.414 (-0.70%) an ounce to $58.690 and the DG spot price is $58.20.
Spot palladium increased 4.5% Tuesday to $1,313.50 an ounce and is up 2.2% this week. Palladium dropped 11% last month after losing 12% in May and rising 3.2% in April. It retreated 25% in the first half of 2026 after rising 74% last year. Currently, the DG spot price is up $4.30 an ounce to $1315.00.
Spot platinum rose 1.8% Tuesday to $1,637.30 an ounce, and it gained 0.6% in the first two days of the week. Platinum tumbled 19% in June after dropping 3.2% in May and gaining 1.3% in April. Platinum slid 23% in the first half of 2026 after increasing 122% in 2025. The DG spot price is currently up $9.90 an ounce to $1647.60.
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