Gold prices rebounded in Asian trading on Monday, recovering from Friday’s profit-taking dip and easing from record highs as investors turned their focus to upcoming United States-Russia talks and Federal Reserve policy signals.
By 4:10 pm AEDT (5:10 am GMT) spot gold was up by $17.87 or 0.6% to US$2,900.26 per ounce.
After eight consecutive weeks of gains, gold continues to be supported by a weaker U.S. dollar and declining U.S. Treasury bond yields. Market sentiment is shifting as expectations grow for a potential resolution to the Russia-Ukraine conflict, with U.S. President Donald Trump set to meet Russian President Vladimir Putin in Saudi Arabia on Tuesday.
Additionally, disappointing U.S. retail sales data, down 0.9% in January, fuelled speculation of further monetary easing.
The weak economic data triggered a sell-off in U.S. Treasury yields, putting further pressure on the dollar. However, gold struggled to capitalise on the dollar’s decline on Friday as traders booked profits ahead of key events, including the U.S.-Russia meeting and the release of the Fed’s January meeting minutes.
Additionally, concerns over a potential trade conflict between the U.S. and the European Union are supporting gold prices. Reports indicate that the European Commission is considering strict import limits on certain food products in response to U.S. trade policies, raising fears of escalating tariff disputes.
With U.S. markets closed for a public holiday, trading conditions are expected to be thin, potentially amplifying price movements.
Investors will also closely monitor speeches from Federal Reserve officials Waller, Harker, and Bowman ahead of Wednesday’s Fed minutes release.
