Gold slipped on Monday as signs of easing geopolitical risks weighed on its safe-haven demand, with markets now focused on upcoming U.S. inflation data that could offer insight into the Federal Reserve’s interest rate outlook.
Spot gold fell 0.7% to $3,376.67 per ounce, as of 0248 GMT, after hitting its highest since July 23 on Friday.
U.S. gold futures for December delivery dropped 1.5% to $3,439.70.
“Cooling geopolitical tensions surrounding the war in Ukraine saw gold fall further, following Friday’s announcement that President Donald Trump will meet with Vladimir Putin on the U.S. soil,” City Index senior analyst Matt Simpson said.
Trump said on Friday he will meet Russian President Putin on August 15 in Alaska to negotiate an end to the war in Ukraine.
Focus this week will be on U.S. consumer prices due on Tuesday, with analysts expecting the impact of tariffs to help nudge the core up 0.3% to an annual pace of 3.0% and away from the Fed’s target of 2%.
“A hot print could further strengthen the dollar and cap gains on gold, though I suspect support will remain in place overall as investors seek to scoop up discounts,” Simpson said.
Recent softer-than-expected U.S. jobs report boosted bets for a Fed rate cut in September. Markets imply around a 90% probability of a September easing, and at least one more cut by this year end.
Non-yielding gold thrives in a low-interest rate environment.
Also on the radar are trade discussions as Trump’s August 12 deadline for a deal between Washington and Beijing loomed.
Meanwhile, COMEX gold speculators increased net long position by 18,965 contracts to 161,811 in the week to August 5.
Elsewhere, spot silver fell 0.8% to $38.02 per ounce, platinum slipped 0.9% to $1,320.45 and palladium lost 0.3% to $1,122.69.
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