Spot gold was down 0.38% at $1,804.99 per ounce, having earlier hit its lowest since January 31 at $1,786.60. US gold futures fell 0.6% to $1,798.
“Spot gold may not stray far from $1,800, held back by the might of the ‘King Dollar’ and high bond yields, while being supported by looming recessionary prospects,” Exinity’s Han Tan said.
Gold prices have lost more than 13% since reaching a near-record high of $2,069.89 an ounce in March, as the dollar and debt yields were bolstered by aggressive bets on higher prices. interest rates.
“Having fallen through the psychologically important threshold of $1,800 an ounce and with aggressive monetary policy more likely to strengthen than weaken, it is hard to see where gold can now find a near-term foothold,” said Rupert Rowling, market analyst at Kinesis Money, in a note.
The dollar consolidated gains near a two-decade high as stocks, oil prices and riskier currencies were hit by unexpectedly weak economic data from China that highlighted fears of a slowdown.
Economic slowdown in China
China has reported disappointing economic data for the month of April, underlining the great damage that the covid-19 lockdowns have caused in the country. The world’s second-largest economy reported staggering declines in retail sales and factory output, below market expectations.
Retail sales shrank 11.1% in April from a year earlier, China’s National Bureau of Statistics reported on Monday. That figure was well below the 6.1% drop forecast in a Reuters survey of economists, and also much lower than the 3.5% decline seen in March.
Industrial production fell 2.9% last month from a year earlier, reversing a 5% gain in March. This marks the worst contraction in industrial production since February 2020, when China’s economy came to a near standstill during the initial coronavirus outbreak. Unemployment also rose to the second highest level on record. The urban unemployment rate hit 6.1% in April, up from 5.8% in March, which was already at its highest point in 21 months. The only time China’s unemployment rate was higher was in February 2020.
Source: Ambito
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