Gold steadied ahead of key US data prints this week, with traders focused on whether they will reinforce bets the Federal Reserve will soon pivot to monetary easing.
Bullion was trading near $2 430 an ounce in Asia after falling 0.5% last week, as markets braced for the release of the consumer price index report due Wednesday. The figure is expected to have risen 0.2% from June.
Such a modest move would be unlikely to derail the central bank from a widely anticipated pivot to lower rates next month, as it also contemplates the need to avoid recessionary risks.
Fed Governor Michelle Bowman on Saturday said she still sees upside risks for inflation and continued strength in the labor market. Higher borrowing costs are typically negative for the precious metal, as it doesn’t pay interest.
Hedge funds trading Comex futures cut bullish bets on gold to a five-week low in the week ending August 6, according to the latest data from the Commodity Futures Trading Commission.
The precious metal has risen about 18% this year and remains in touching distance of last month’s record high. Along with rate-cut expectations, it’s also been supported by srong central bank purchases and robust demand from Chinese consumers, and increased haven buying due to conflicts in the Middle East and Ukraine.
Spot gold was little changed at $2429.41 at 9:11 a.m. in Singapore. The Bloomberg Dollar Spot Index was flat. Silver fell, while palladium and platinum were steady.