Gold settles higher as oil prices retreat ahead of Fed decision

Gold bars

Gold prices closed higher on Monday as oil prices declined following the cessation of reciprocal strikes between the United States and Iran, easing inflation concerns and supporting demand for the precious metal ahead of the Federal Reserve's policy decision later this week.

The decline in oil prices also weighed on the US dollar, making dollar-denominated gold less expensive for buyers using other currencies.

Investors are awaiting the Federal Reserve's interest rate decision on Wednesday, as well as Thursday's release of the core Personal Consumption Expenditures (PCE) Price Index, the US central bank's preferred measure of inflation.

In China, official data showed that net gold imports through Hong Kong more than doubled year-on-year in June, despite declining by more than 5% compared with the previous month.