Gold price (XAU/USD) regains positive traction at the start of a new week and climbs beyond the $3,300 mark during the Asian session, reversing a major part of Friday's losses.
The Personal Consumption Expenditures (PCE) Price Index released on Friday further pointed to signs easing inflationary pressures in the US and bolstered the case for more rate cuts by the Federal Reserve (Fed). This, in turn, is seen weighing on the US Dollar (USD) and acting as a tailwind for the non-yielding yellow metal.
Meanwhile, geopolitical risks stemming from the protracted Russia-Ukraine war and conflicts in the Middle East, along with renewed US-China trade tensions, temper investors' appetite for riskier assets.
This is evident from a generally weaker tone around the equity markets, which turns out to be another factor that benefits the safe-haven Gold price.
However, the lack of strong follow-through buying warrants caution for the XAU/USD bulls ahead of this week's US macro releases scheduled at the start of a new month.
Traders continued to bet that the Federal Reserve will lower borrowing costs in September and are pricing in the possibility of another rate cut in December.
Fed Governor Christopher Waller said on Monday that rate cuts remain possible later this year even with the Trump administration's tariffs likely to push up price pressures temporarily.
Source: Fxstreet
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