Bullion Gives Back Some Recent Gains
Spot gold edged lower on Monday as the U.S. dollar recovered after last week’s decline, with investors remaining cautious ahead of the release of the Federal Reserve’s latest meeting minutes.
The precious metal retreated after staging a strong rebound from eight-month lows during the previous week, while the greenback bounced from near two-week lows.
By 11:43 GMT, spot gold was down 0.5% at $4,154.14 an ounce, while gold futures rose 1.0% to $4,166.76 an ounce.
David Morrison, Senior Market Analyst at Trade Nation, said:
“The greenback has bounced back this morning, knocking gold lower. Time will tell if this drop proves to be short-lived, or more significant.”
Softer Payrolls Boosted Gold Last Week
Gold advanced more than 2% last week, ending its first positive week since mid-May after weaker-than-expected U.S. employment data prompted investors to scale back expectations for additional Federal Reserve rate increases.
Markets continue to view inflation and labour market conditions as the key indicators shaping future monetary policy decisions.
Higher borrowing costs generally reduce the appeal of gold because the metal offers no yield, making interest-bearing assets relatively more attractive.
Precious Metals Trade Lower
Silver and platinum also weakened on Monday after posting solid gains in the previous week.
Spot silver declined 1.1% to $61.7430 an ounce, while spot platinum slipped 0.4% to $1,635.31 an ounce.
Interest Rate Outlook Remains in Focus
The U.S. Dollar Index gained 0.1% as traders reassessed expectations for future Federal Reserve policy.
Although oil prices have retreated, easing some inflation concerns, investors continue to monitor the potential impact of artificial intelligence-related investment and broader price pressures on the inflation outlook.
Attention now turns to the minutes from the Fed’s June policy meeting, which could provide additional clues about whether policymakers still expect at least one more interest rate increase this year.
Source: Original Article
