Gold prices fell to a more than one-week low on Monday, weighed down by a stronger dollar as focus turns to the Federal Reserve policy meeting this week with recent spikes in U.S. consumer prices seen as a temporary blip. Spot gold was down 0.5% at $1,867.51 per ounce, as of 0119 GMT, its lowest since June 4. U.S. gold futures fell 0.5% to $1,871.10 per ounce.
The dollar rose 0.1% to hover near a one-week high against its rivals, making gold more expensive for holders of other currencies. Last week, data showed U.S. consumer prices rose solidly in May, leading to the biggest annual increase in nearly 13 years as a reopening economy boosted demand for travel-related services.
Focus now shifts to the Fed's June 15-16 policy meeting for further clarity on the policymakers' view on rising inflation and economic recovery. The Bank of Japan is set to keep its money spigots wide open and may extend its pandemic-relief programmes next week to support a fragile economic recovery.
Some investors view gold as a hedge against higher inflation that could follow stimulus measures. The demand for physical gold crept up last week in top hubs India and China though dealers were still forced to offer discounts, while businesses limped back to life in India as some COVID-19 restrictions were eased.
Speculators reduced their net long positions in COMEX gold in the week ended June 8 and raised their net long positions in silver, data from the U.S. Commodity Futures Trading Commission showed on Friday. Silver slipped 0.4% to $27.78 per ounce, palladium eased 0.1% to $2,773.19, while platinum dipped 0.8% to $1,141.
Copyright©2022 Living Media India Limited. For reprint rights: Syndications Today