(Bloomberg) -- Gold steadied after a two-day gain as investors waited for a US inflation report that’ll shed light on the path for interest rates, while assessing continued threats to the Federal Reserve’s independence.

Bullion held just below $3,400 an ounce, with traders looking ahead to Friday’s US personal consumption report — the Fed’s preferred inflation gauge. The figure — excluding food and energy — is expected to accelerate at the fastest annual pace in five years, which could limit the central bank’s ability to ease policy. Lower borrowing costs tend to benefit gold, as it doesn’t pay interest.

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Swaps markets still show  a nearly 80% chance of a rate cut next month, with traders increasing bets on a September move after Fed Chair Jerome Powell last week opened the door to a reduction. Still, he also emphasized a high degree of uncertainty over how inflation and the US labor market would evolve as the impact of President Donald Trump’s tariffs feed through.

Meanwhile, investors continued to monitor tensions between the White House and the Fed, after Governor Lisa Cook vowed to fight Trump’s move to fire her due to allegations that she falsified mortgage documents. Her lawyer said the attempt to oust her “lacks any factual or legal basis.”

If Trump is successful in removing Cook it would give him an opportunity to secure a four-person majority on the Fed’s seven-member board. The president has repeatedly criticized Powell and his colleagues for not cutting rates this year, and the market is worried that a less independent monetary authority could erode investor confidence in the US and lead to faster inflation. Such a scenario would likely bolster gold’s allure as a safe haven.

The precious metal has been largely rangebound since hitting a record above $3,500 an ounce in April, with the market looking for fresh catalysts following a blistering rally. Trade and geopolitical frictions, inflows to exchange-traded funds, and central bank moves to diversify away from the US dollar have aided bullion.

Gold was steady at $3,395.05 an ounce at 8:27 a.m. in London. The Bloomberg Dollar Spot Index declined 0.1%. Silver, platinum and palladium rose.

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