Gold (XAU/USD) extended its decline for a fifth straight day on Tuesday, dropping to a more than one-week low near the $2,630 support level during early European trading. The ongoing slump follows Friday’s robust US jobs report, which confirmed the resilience of the labor market and led investors to scale back expectations for a significant interest rate cut by the Federal Reserve. This shift has weighed on demand for the non-yielding asset.
However, a slight pullback in the US Dollar, combined with the potential for escalating geopolitical tensions in the Middle East, could provide some support for gold as a safe-haven investment. Additionally, traders may adopt a cautious approach ahead of the release of the Federal Open Market Committee (FOMC) meeting minutes on Wednesday.
Looking ahead, key inflation data in the form of the US Consumer Price Index (CPI) and Producer Price Index (PPI) on Thursday and Friday, respectively, is expected to bring fresh momentum to XAU/USD trading.
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