Gold rebounds 1.1% to $4,158 as traders await US data

Gold prices rebounded 1.1% to $4,158.28 per ounce on Tuesday, recovering from a more-than-seven-week low hit the previous day, as investors awaited US economic data for clues on Federal Reserve policy. The bounce follows Monday's sharp 4% sell-off to $4,110.55, its lowest since August 5. Analysts attribute recent weakness to higher oil prices and increased market pricing of further US rate hikes, which could keep the dollar and real yields elevated, raising the opportunity cost of holding gold. Traders now watch Wednesday's ADP employment and PCE data, with markets pricing a 68% chance of an October rate hike and 95% for December. Middle East tensions rose after President Trump rejected an Iran peace proposal, while Fed officials warned against letting high inflation become the norm.