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Gold traded lower on MCX on September 1 amid renewed tensions between the US and Iran, adding to inflation concerns. October gold futures fell 0.16% to Rs. 1,54,209 per 10 grams, and September silver futures advanced 0.45% to Rs. 2,34,898.
Meanwhile, Brent crude futures rose 0.75% to USD 91.18 per barrel. US West Texas Intermediate (WTI) edged higher by 1.06% to USD 86.67 per barrel.
The CME FedWatch Tool indicates markets are currently pricing in a 33.6% probability that the Fed will keep rates unchanged and a 66.4% chance of a rate hike in September.
24K gold rose by Rs. 16 to Rs. 1,56,930 per 10 grams, while 22K gold also advanced by Rs. 15 to Rs. 1,43,850. By city, Mumbai and Kolkata mirrored prices at Rs. 1,56,930, while Delhi was at Rs. 1,57,080 and Chennai at Rs. 1,56,930.
US gold prices remained subdued on Tuesday as traders assessed Middle East tensions and awaited key US labor market data due this week that could shape expectations for Federal Reserve monetary policy.
Spot gold was down 0.3% at USD 4,437.10 per ounce. US gold futures edged up 0.1% to USD 4,485.30.
Spot silver gained 0.3% to USD 66.34 per ounce, platinum edged 0.1% higher to USD 1,793.03, while palladium was flat at USD 1,356.75.
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Gold has been pressured by "Fed Chair Warsh’s hawkish Jackson Hole speech, plus fresh tensions in the Strait of Hormuz, which have brought with it higher oil prices and raised inflationary expectations," IG market analyst Tony Sycamore said.
"One hike in isolation should not be a game changer for gold. Two or three might be," he added.
On the upside, immediate resistance is aligned with the 100-period SMA around USD 4,480, ahead of the 23.6% Fib. Retracement at USD 4,532, with a retest of the cycle high region near USD 4,697 likely requiring a sustained break above these barriers.
On the downside, initial support is seen around USD 4,430, followed by USD 4,350 and the 61.8% retracement at USD 4,265. A deeper correction would expose the 78.6% level at USD 4,149.
