Gold prices fell in Asian trade on Tuesday, retreating from strong gains in the prior session as metal markets remained on edge before a string of key U.S. economic readings due this week.
Silver and platinum prices also fell, having taken limited support from an overnight drop in the dollar, although the greenback steadied in Asian trade.
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Spot gold fell 0.7% to $5,022.19 an ounce, while gold futures for April fell 0.7% to $5,044.79/oz by 00:34 ET (05:34 GMT).
Spot silver fell 2.1% to $80.930/oz, while spot platinum fell 1.8% to $2,084.85/oz.
Gold, metal prices remain volatile; dip-buyers elusive Precious metals were nursing sharp swings over the past week as a mix of profit-taking and overheated positioning saw prices slide from record highs. Uncertainty over U.S. monetary policy, ahead of a potential leadership change at the Federal Reserve, also sparked heightened volatility.
Precious metals were also grappling with swings in safe haven demand, amid a flurry of contrasting developments in U.S.-Iran ties. While the countries did tout some progress in weekend talks held over Iran’s nuclear plans, Washington on Monday still issued a warning for U.S.-flagged ships traveling in the Strait of Hormuz.
While gold and precious metals did recover a measure of recent losses, they remained well below peaks seen in late-January, with traders seen reluctant to buy in en-mass.
"Dip-buying has been selective rather than aggressive, indicating participants are still sensitive to macro signals," OCBC analysts said in a note.
They noted that while a trend of de-dollarization had benefited gold in the past year, near-term dollar direction will still largely be dictated by the U.S. labor market and its implications for monetary policy.
US economic data deluge in focus this week Focus this week is squarely on key U.S. economic readings for more cues on the world’s largest economy, as well as the path of interest rates.
Retail sales data for December is due later on Tuesday, offering up more cues on consumer spending amid growing headwinds for the labor market.
Nonfarm payrolls data for January is due on Wednesday, while consumer price index inflation data is due on Friday. Both prints are expected to factor into the Fed’s plans for interest rates, given that inflation and labor market strength are the banks two biggest considerations.
Markets continued to gauge the outlook for monetary policy under Kevin Warsh, U.S. President Donald Trump’s nominee for the next chairman of the Fed after Jerome Powell’s term ends in May.
Warsh was viewed as a less dovish pick, with his nomination sparking deep losses in metal markets– losses they are yet to recover from. Gold plummeted from a near $5,600/oz record high, while silver slumped from levels of more than $120/oz.
