Gold rises on weaker dollar, lower oil ahead of US inflation data

By Pablo Sinha

Oct 13 (Reuters) - Gold prices ticked up on Tuesday, as a weaker dollar and lower oil prices provided support, while investors looked out for key US inflation data and remarks from the Federal Reserve Chair later this week to gauge future monetary policy.

Spot gold rose 0.2% to $4,178.97 per ounce by 9:19 a.m. EDT (1319 GMT). US gold futures for December delivery were up 0.3% to $4,202.70 per ounce.

"We've got the dollar and oil down this morning, so we're seeing a teeter-totter effect. I expect it to be a lighter session here ahead of what's coming up Wednesday and Thursday," said Bob Haberkorn, senior market strategist at StoneX.

Oil prices fell on Tuesday and were on track for their first decline in nearly a week. O/R

The dollar and benchmark 10-year Treasury yields slipped from their respective highs, but still hovered near elevated levels. USD/ US/

Fed Governor Christopher Waller on Tuesday said the recent rise in US bond yields reflects stronger economic growth rather than higher inflation expectations, which remain "well anchored."

Gold loses its appeal in a high-interest-rate environment as it does not yield interest.

Investors are looking ahead to the Consumer Price Index data on Wednesday, while Thursday's Producer Price Index figures and remarks from Fed Chair Kevin Warsh will be closely parsed.

The International Monetary Fund on Tuesday highlighted risks from elevated public debt levels and rising bond yields that may be driven higher still by war-driven inflation pressures.

"Interest rate hikes have increasingly become a double-edged sword for gold. While higher rates raise the opportunity cost of holding non-yielding assets such as gold, they also intensify the fiscal burden on many governments and thereby exacerbate debt sustainability concerns," analysts at Commerzbank said in a note.

Currently, traders see only a 19% chance of a Fed rate hike this month but are pricing in an 88% chance of a December increase, according to CME's FedWatch tool.

Elsewhere, spot silver fell 0.6% to $59.94 per ounce, platinum edged 0.3% lower to $1,681.23 per ounce and palladium dropped 1.2% to $1,130.30 per ounce.