By Arundhati Sarkar
Aug 8 (Reuters) – Gold prices traded in a tight range on Monday, with gains capped by fears of big interest rate hikes by the Federal Reserve, while investors waited on the sidelines ahead of the US inflation data this week.
* By 1038 GMT, spot gold was up 0.2% at $1,778.34 per ounce, after losing 1% in the previous session. US gold futures were up 0.1% at $1,793.10.
* The main factor against a further recovery in gold is related to mounting pressure over the Fed’s eventual adoption of an aggressive stance following strong US jobs data, said Carlo Alberto De Casa of Kinesis Money.
* However, investors are slightly recalibrating their position after Friday’s rally in the dollar, and “may continue to think that the peak of inflation is not too far away and the pressure on the Fed could be stopped,” he added.
* Market players’ attention is now focused on the US Consumer Price Index report to be released on Wednesday and could offer more clues about the path of the Fed’s rate hikes. Analysts polled by Reuters expect that annual inflation slows to 8.7% in July from 9.1% previously.
* Rising rates in the US raise the opportunity cost of holding non-interest bearing bullion.
* The dollar gave gold a respite and eased slightly from its highest since July 28.
* In other precious metals, spot silver rose 1.2% to $20.12 an ounce; platinum held at $932.45; and palladium was up 2.3% at $2,184.50.
(Edited in Spanish by Carlos Serrano)