Gold prices rose on Monday, while Treasury yields fell, as investors await economic data and comments from Federal Reserve officials later this week for clarity on the timing of the US central bank on interest rate cuts.
BASICS
* Spot gold rose 0.2% and stood at $2,324.36 an ounce, around 0155 GMT. US gold futures also rose 0.2% to $2,336.70.
* The 10-year US Treasury yield fell and was last at 4.2496%, making non-yielding bullion more attractive to investors.
* US business activity rose to a 26-month high in June amid a rebound in employment. Last week’s data showed that first-time U.S. jobless claims fell moderately.
* Traders are watching the report on the US core personal consumption expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure, due on Friday for more clues on the timing and the magnitude of the rate cuts.
* Investors are also awaiting comments from Fed officials who will speak this week.
* Traders are currently pricing the probability of a Fed rate cut in September at around 66%, according to CME’s FedWatch tool.
* Lower interest rates reduce the opportunity cost of holding non-yielding bullion.
* Swiss gold exports in May fell from the previous month, due to reduced shipments to India and Hong Kong, according to customs data.
* Physical demand for bullion in India, the world’s second-largest consumer of gold, slowed last week as prices neared near record levels, curbing retail buying in the absence of festivals.
* Spot silver rose 0.1% to $29.55 an ounce, platinum fell 0.2% to $990.30 and palladium lost 0.1% to $947.50.
DATA/EVENTS (GMT, June) 0800 Germany Ifo New Business Climate 0800 Germany Ifo New Curr Conditions 0800 Germany Ifo New Expectations (Reporting by Sherin Elizabeth Varghese in Bengaluru; Editing by Sherry Jacob-Phillips)
