Retreat in gold
Gold fell following a weekly decline ahead of the Fed’s midweek meeting, where policymakers are expected to reaffirm their stance on long-term high interest rates.
Bullion fell as much as 0.8 percent after losing more than 2 percent last week. The Federal Reserve’s preferred measure of inflation rose sharply in March, according to data on Friday. Swap investors see only one Fed cut this year; That’s well below the roughly six quarter-point cut seen earlier this year. Higher rates are generally a negative for gold because it does not pay interest.
Gold also lost some support as safe-haven demand faded and US Secretary of State Antony Blinken stepped up efforts to broker a ceasefire at meetings in the Middle East on Monday.
Meanwhile, foreign exchange markets were in the spotlight amid speculation that Japanese officials might start buying yen to support the yen after it fell to its lowest level in more than 30 years. If they act, it could weaken the dollar and potentially boost bullion.
Gold reached a record earlier this month, rising nearly 13 percent this year despite the Fed’s delayed cut timeline. The rise of the precious metal is due to central bank purchases, strong demand from Asian markets, especially China, and increasing geopolitical tension from Ukraine to the Middle East.
Spot gold fell 0.4 percent to $2,329.50 per ounce at 10:05 a.m. Singapore time, recording its first weekly decline since mid-March. Bloomberg Dollar Spot Index rose 0.1 percent after a two-week rise. While silver remained horizontal, palladium fell and platinum rose.