Gold edges higher on dollar pullback, bearish outlook persists

14 July 2026

Gold edged higher on Tuesday as the US dollar retreated to some extent. The metal moved higher after a drop in the previous session, which pushed prices to a two-week low. However, the outlook remains bearish.

Renewed escalation of tensions in the Middle East has driven oil prices to a one-month high, stoking concerns over global inflation. This has reinforced expectations that major central banks could tighten monetary policy, lifting bond yields. Short-term yields have climbed to multi-month highs as a result, weighing on the non-yielding metal.

Central bank expectations have also turned more hawkish. The Federal Reserve is now expected to raise interest rates twice before year-end, compared with a single move priced in just a week ago. Tighter monetary policy conditions could reinforce the higher-yield backdrop weighing on gold.

Looking ahead, focus turns to today’s US inflation data, with the core reading expected to hold while the headline figure is seen retreating. Persistent inflation could push yields higher still, while a softer print could ease yields and offer gold some relief, though Middle East tensions could limit how far such a move extends. Testimony from the Federal Reserve chair will also be watched closely for clues on the monetary policy path ahead.

 

Zaid Barem / ymm