Gold prices flat as traders gear up for US inflation data

GOLD prices were flat on Monday (May 8), after slumping more than 2 per cent in the previous session, as investors maintained a cautious stance ahead of key US inflation data due this week.

Spot gold held its ground at US$2,016.29 per ounce, as of 0016 GMT. US gold futures were down 0.1 per cent at US$2,023.80.

The US consumer price index (CPI) data is due on Wednesday.

Bullion prices fell over 2 per cent on Friday after stronger-than-expected US payrolls data tempered expectations of interest rate cuts from the Federal Reserve.

Data on Friday showed that US job growth accelerated in April while wage gains increased solidly, pointing to persistent labour market strength.

US Treasury Secretary Janet Yellen on Sunday issued a stark warning that a failure by Congress to act on the debt ceiling could trigger a “constitutional crisis”.

Traders will also keep a tab on the developments surrounding the US banking sector.

Economic uncertainty and lower rates boost demand for zero-yielding gold.

Global gold demand fell in the first three months of 2023 as large purchases by central banks and Chinese consumers were offset by reduced investor buying, the World Gold Council (WGC) said on Friday.

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China’s gold splurge reaches sixth month as reserves rise again

Physical gold dealers in major trading centre in China offered discounts last week for the first time in more than a month as elevated prices kept retail buyers away, while a record surge in local rates also hammered demand in India.

Spot silver was unchanged at US$25.64 per ounce, platinum lost 0.1 per cent to US$1,058.48, while palladium gained 1 per cent to US$1,505.80. REUTERS