Spot gold was down 0.2 per cent to US$1,777.03 per ounce, while US gold futures lost 0.2 per cent to US$1,774.80
Gold prices slipped to hit a one-week low on Monday, weighed down by a jump in the dollar and mixed signals from the US Federal Reserve on monetary policy tightening despite weak inflation data.
Gold remains in a corrective phase and remained bearish which failed to retest 1800. With Core PCE roughly in line with expectations it has calmed fears that the Fed may taper sooner.
Spot gold was down 0.2 per cent to US$1,777.03 per ounce by 2.49 am GMT, after reaching its lowest levels since June 21 at US$1,770.36 earlier during the session. US gold futures lost 0.2 per cent to US$1,774.80.
The jury’s still out, said IG Market analyst Kyle Rodda. On one hand, we’ve to think about normalising policy, but on the other, a lot of Fed speakers are suggesting inflation will be transitory, so we don’t need the Fed to slam on the brakes. And, that is kind of sending mixed signals.
Gold prices added 0.8 per cent on Friday after data showed the US personal consumption expenditures price index came in below expectations.
Minneapolis Fed President Neel Kashkari said he expected recent high inflation readings would not last.
The dollar bounced back from Friday’s lows, making gold expensive for holders of other currencies.
The market is trading in a range and until gold breaks above US$1,800 or below US$1,760, it’s just looking like a sideways trend in the short term, Mr Rodda said.
Investors were also keeping a close watch on the negotiations over an US infrastructure deal.
Silver was steady at US$26.07 per ounce, palladium advanced 0.1 per cent to US$2,640.31. Platinum eased 0.7 per cent to US$1,103.40.
