Gold Prices Retreat Amid Thin Trading and Profit-Taking
Gold prices have dipped as thin trading volumes prevail due to market closures in the U.S. and China. The decline follows a significant jump last session, attributed to profit-taking by traders. With attention on inflation data, market participants speculate about future interest rate adjustments.
Gold prices dropped on Monday as market trading volumes remained thin with both U.S. and China markets closed for local holidays. The market saw some traders booking profits following a 2.5% rise in the last session, causing spot gold to fall 0.9% to $4,997.59 per ounce by 0726 GMT.
U.S. gold futures for April delivery decreased by 0.6% to $5,017.20 per ounce. Tim Waterer, KCM's chief analyst, noted that the lack of fresh catalysts and profit-taking behavior contributed to gold giving back some gains post-CPI release. This comes with the backdrop of U.S. markets closed for Presidents' Day and China's Lunar New Year holiday.
Market expectations are turning towards the Federal Reserve's next meeting, with interest rates potentially remaining steady despite predictions of rate cuts later in the year. Geopolitical tensions also loom with potential military actions against Iran being considered, which could impact market dynamics.
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