Gold prices eased on Tuesday, holding near the key psychological $1,900 level, as U.S. bond yields and the dollar remained elevated ahead of the retail sales data that could shed light on the impact of higher rates on consumer spending.
Spot gold slipped 0.2% to $1,905.10 per ounce by 0119 GMT, trading near its lowest level in 1-1/2 months hit in the previous session. U.S. gold futures dropped 0.3% to $1,938.20.
Making bullion expensive for overseas buyers, the U.S. dollar hit its highest levels in more than a month on Monday amid worries over China’s economy. U.S. 10-year Treasury yields were near their highest levels since November.
Asian stock markets were pinned near one-month lows on Tuesday as China’s central bank unexpectedly cut key policy rates for the second time in three months, in a fresh sign that the authorities are ramping up monetary easing efforts to boost a sputtering economic recovery.
Japan’s economy expanded for a third straight quarter in April-June, although global recession prospects cloud the outlook.
Treasury Secretary Janet Yellen on Monday said President Joe Biden’s policies are powering historic job growth and rebuilding competitiveness, despite polls showing Americans remain skeptical.
Americans said last month they expected weaker inflation over the next few years, according to a survey by the New York Federal Reserve.