By News Zier Editorial Team | Reviewed and approved by Editor-in-Chief to ensure accuracy and integrity.
New York – Gold prices edged lower on Monday as traders anticipated a technical correction following recent gains. The yellow metal’s retreat comes as markets brace for upcoming U.S. economic data that could shape Federal Reserve policy in the months ahead.
Spot gold slipped by 0.3%, trading at $1,918.50 per ounce, while U.S. gold futures dropped to $1,921 per ounce. Analysts attribute the decline to profit-taking by investors after gold’s recent rally, as well as a strengthening U.S. dollar, which typically weighs on the metal’s appeal.
“This appears to be a technical correction,” said a commodities strategist. “Gold has been on an upward trend, but with the dollar gaining some strength, traders are taking the opportunity to lock in profits.”
Market Drivers:
Gold, often viewed as a hedge against inflation and economic uncertainty, had been supported by expectations of a less aggressive Federal Reserve stance on interest rate hikes. Cooling inflation data in recent months has led many to believe the Fed might pause further tightening, but upcoming reports on retail sales and industrial output could offer more clarity.
The Dollar’s Impact:
A slightly stronger U.S. dollar index, which measures the greenback against a basket of major currencies, also contributed to gold’s pullback. A stronger dollar makes gold more expensive for international buyers, dampening demand.
Looking Ahead:
The market is now closely watching U.S. economic data due later this week, which could provide insight into the health of the economy and influence the Federal Reserve’s next moves. Any indication of stronger-than-expected growth or persistent inflation could further pressure gold prices.
Meanwhile, long-term sentiment around gold remains bullish, with some analysts predicting a rebound as geopolitical tensions and global economic uncertainties persist.
“Gold remains an essential hedge for investors in this volatile environment,” noted a senior commodities analyst.
Disclaimer: This article was informed by reports from The Wall Street Journal and adapted by the News Zier Editorial Team for clarity and additional context.
For more details: Visit the original report on The Wall Street Journal.
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