PRECIOUS-Gold prices edge higher as spotlight shifts to US inflation data

Aug 12 (Reuters) - Gold prices slightly recovered on Tuesday, after a sharp fall in the previous session, as investors looked forward to U.S. inflation data that could offer further insight into the Federal Reserve's rate-cut trajectory.

FUNDAMENTALS

Spot gold XAU= was up 0.3% at $3,355.59 per ounce, as of 0105 GMT. U.S. gold futures GCcv1 for December delivery edged 0.1% higher to $3,406.80.

Gold prices slipped 1.6% on Monday, while futures dropped by more than 2% after U.S. President Donald Trump said tariffs will not be placed on imported gold bars, easing jitters in the market.

All eyes are on U.S. consumer prices index data, which is due at 1230 GMT. Economists polled by Reuters project core CPI to have risen 0.3% in July, pushing the annual rate higher to 3%, away from the U.S. Fed target of 2%.

Traders are pricing in around a 90% chance of a Fed rate cut next month. Gold tends to perform well during periods of uncertainty and in a low-interest-rate environment.

Trump has repeatedly criticised the Fed for not cutting rates at recent meetings, and markets are eyeing who will succeed current Chair Jerome Powell, whose term ends in May.

Meanwhile, Trump has signed an executive order extending a pause in sharply higher U.S. tariffs on Chinese imports for another 90 days, a White House official said on Monday.

On the geopolitical front, Trump will meet Russian President Vladimir Putin on August 15 in Alaska to negotiate an end to the war in Ukraine.

Elsewhere, spot silver XAG= gained 0.6% to $37.81 per ounce, platinum XPT= rose 0.7% to $1,336.14 and palladium XPD= climbed 0.9% to $1,145.32.

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