Gold steadied near record highs during Monday's Asian session, trading in a narrow range as markets braced for a pivotal week of central bank decisions and monitored U.S.-China trade talk developments.
By 3:30 pm AEST (5:30 am GMT), spot gold was up $1.84, or 0.1%, at US$3,644.06 per ounce, holding close to the $3,650 barrier seen last week.
The latest uptick in bullion was underpinned by weaker-than-expected economic data out of China. Industrial output grew 5.2% in August, slowing from July’s 5.7%, while retail sales rose 3.4%, down from 3.7% a month earlier.
Both figures undershot forecasts, fuelling speculation that Beijing will roll out fresh stimulus to shore up growth.
Gold also drew support from the lack of progress in the first day of renewed U.S.-China talks in Madrid on Sunday.
Negotiations, which are set to continue through Wednesday, focus on trade, economic ties, and the looming U.S. deadline for TikTok divestment.
Meanwhile, investors remain cautious ahead of the U.S. Federal Reserve’s policy meeting on 17 September. The central bank is widely expected to cut its benchmark rate by 25 basis points (bp), with markets also entertaining the possibility of a larger 50bp move.
Traders are pricing in at least three rate cuts this year as the Fed contends with slowing job growth, sticky inflation, and political pressure from President Donald Trump for lower borrowing costs.
Speculation over the pace and scale of future easing has buoyed gold, which typically benefits from a lower-rate environment.
Until the Fed delivers its decision, markets are expected to remain sensitive to both U.S.-China trade developments and U.S. retail sales data, leaving gold well-supported near record levels.
