- Trump and Putin summit to take place at military base in Alaska
- Gold down 1.8% so far this week
- US producer inflation heats up as goods, services prices soar
Aug 15 (Reuters) - Gold prices edged higher on Friday, buoyed by a weaker dollar, but were poised for a weekly decline after hotter-than-expected U.S. inflation data dampened prospects for a super-sized September rate cut by the Federal Reserve.
Spot gold rose 0.3% to $3,345.21 per ounce as of 0757 GMT. Bullion has lost 1.5% for the week. U.S. gold futures for December delivery gained 0.3% to $3,391.70.
The U.S. dollar index fell 0.3%, making gold less expensive for other currency holders.
"In the short term, gold has a heightened inverse relationship to moves in the U.S. dollar, which in turn is being whipsawed by economic data and fast news on both tariffs and Ukraine," independent analyst Ross Norman said.
U.S. producer prices increased by the most in three years in July amid a surge in the costs of goods and services, signaling a broader inflation uptick, data showed on Thursday. Weekly jobless claims also came in lower than expected, at 224,000 compared to forecasts of 228,000.
The economic data shifted expectations for a Fed rate cut, with investors now anticipating easing in October rather than September.
Non-yielding gold typically performs well in low-interest-rate environments.
Consumer price index data earlier this week showed only a marginal increase in July, briefly boosting hopes for large-size rate cut by the Fed.
"We have seen in the past that gold price corrections get smaller and smaller, suggesting that some buyers, who missed out in the past, use these price setbacks as a way to gain exposure to the yellow metal," said UBS commodity analyst Giovanni Staunovo.
Physical gold demand in India improved slightly this week as a price pullback lifted buying interest among consumers, while activity in other top Asian hubs remained lacklustre.
On the geopolitical front, investors are awaiting the outcome of U.S. President Donald Trump and Russian President Vladimir Putin's meeting in Alaska later in the day.
Elsewhere, spot silver gained 0.1% to $38.02 per ounce, platinum rose 0.5% to $1,363.90, and palladium lost 0.2% to $1,143.25.
Reporting by Anmol Choubey in Bengaluru; Editing by Joe Bavier
Source: Reuters