PRECIOUS-Gold gains on weak dollar, investors ramp up Fed rate cut bets

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Rate cut bets rise after mild July inflation

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US dollar at an over two-week low

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Trump meets Putin on Friday to discuss war in Ukraine

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US and China extend tariff truce by 90 days

(Updates for U.S. morning hours)

By Sherin Elizabeth Varghese

Aug 13 (Reuters) - Gold rose on Wednesday, lifted by a weaker dollar and falling Treasury yields, as mild U.S. inflation data cemented expectations for a Federal Reserve rate cut in September and nudged up bets on additional easing later this year.

Spot gold gained 0.5% to $3,362.92 per ounce by 9:47 a.m. ET (1347 GMT). U.S. gold futures for December delivery rose 0.4% to $3,412.20.

The dollar index hit a more than two-week low, making bullion cheaper for overseas buyers, while the yield on the benchmark 10-year Treasury note edged lower.

"Gold is buoyant on heightened expectations of a September Fed rate cut, following benign CPI data and July's weak non-farm payrolls," said Nikos Tzabouras, senior market analyst at Tradu.com.

Markets are pricing in a 97% chance of a September Fed cut after mild July inflation data signalled limited pass-through from U.S. President Donald Trump's sweeping import tariffs, following weak jobs data earlier this month, reinforcing bets on at least one more cut.

Investors now await further U.S. indicators this week, including the producer price index, weekly jobless claims, and retail sales.

On the geopolitical front, European and Ukrainian leaders were set to speak with Trump ahead of his meeting with Russian President Vladimir Putin, while Washington and Beijing extended their tariff truce by 90 days.

"If gold were to take out recent resistance around $3,400, it would likely be driven more by geopolitical developments than by economic data," Fawad Razaqzada, market analyst at City Index and FOREX.com said.

"While I maintain a bullish long-term outlook on gold, my view for the rest of this year is more cautious. Prices may continue to consolidate or see a mini correction in the coming months as equity markets rally aggressively."

Gold, a traditional refuge in times of economic or geopolitical strain, tends to benefit from low interest rates.

Spot silver rose 1.6% to $38.48 per ounce, platinum was down 0.1% at $1,335.19 and palladium gained 0.1% to $1,129.89. (Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Leroy Leo)