Gold Prices Rise Over 1% in July, Best Monthly Performance Since February

Gold prices slid 2% on Friday (July 31) as the US dollar rebounded from a one-month low, but still closed July up over 1.1%, marking the best monthly performance since February and ending a four-month losing streak.

Spot gold dropped 1.3% to $4,049.83 per ounce, briefly falling 2% during the session.

August-delivery gold futures settled down 1.3% at $4,107 per ounce.

Gold’s July gains were primarily driven by weaker-than-expected inflation data, which, combined with oil prices retreating to pre-Iran war levels earlier in the month, led traders to scale back expectations of Federal Reserve (Fed) rate hikes this year.

Han Tan, Chief Market Analyst at Bybit, said: "Although gold has ended its four-month losing streak, it has struggled to sustain a significant distance above the psychological $4,000 level."

Tan added that gold’s continued support above $4,000 stems from investors anticipating that Fed Chair Powell may broaden the policy focus beyond the Fed’s preferred inflation metrics and interest rate decisions.

Thursday’s data showed that US inflation eased in June, but renewed conflict in the Middle East has pushed oil prices higher again, raising concerns about a potential resurgence in inflation.

Powell reaffirmed his commitment to controlling inflation this week but did not signal readiness for a rate hike. The dollar plunged 2.4% on Thursday and stabilized on Friday. A stronger dollar makes dollar-denominated gold more expensive for holders of other currencies.

According to CME’s FedWatch tool, traders now assign a 65% probability to a Fed rate hike in September, down from over 80% a week earlier.

Other precious metals:

Spot silver fell 2.1% to $57.76 per ounce.

Spot platinum declined 0.6% to $1,650.14 per ounce.

Spot palladium dropped 1.8% to $1,281.18 per ounce.

All three posted monthly gains.

China’s market regulators held a price compliance guidance meeting on Friday, urging solar companies to resist "predatory" price competition. The statement highlighted silver as a key industrial metal used in photovoltaic panels.