Gold prices rose during early trading, Tuesday, recovering from the lowest level in three weeks, supported by a decline in the dollar, after an official US report showed that consumers expect a decline in inflation, which raised hopes that the Federal Reserve (the US central bank) would reduce interest rates.
A report by the Federal Reserve Bank of New York on Monday showed that consumers expect inflation to decline, and they also expect income and spending to decline in the coming years.
Low interest rates reduce the opportunity cost of holding non-yielding bullion.
The dollar index fell one day after recording the largest daily decline in two weeks, which also supported the prices of the precious metal.
Change in prices
Gold rose in instant transactions 0.2 percent to $2,032.73 per ounce by 0458 GMT, after yesterday, Monday, recording its lowest level since December 18.
US gold futures rose 0.3 percent to $2,038.90 per ounce.
As for other precious metals, silver in spot transactions increased 0.1 percent to $23.11 per ounce, platinum jumped 0.3 percent to $948.42, and palladium rose 0.6 percent to $1,003.46 per ounce.
