Gold edged down on a Monday as speculators took their profits as prices rallied on thin volumes on Friday to their highest in a month on technical buying. A strong fall in the greenback triggered rapid gains in commodities and options-related buying on Friday.
US dollar prices to buy gold fell back below $1,750 an ounce, a few dollars below where they closed last week following Friday's rally, while stocks and commodities also edged lower and US Treasuries gained ahead of further discussion on Greece.
Gold prices hovered just below $1,738 an ounce Monday morning in London, close to three-week highs, while stocks and commodities were broadly flat and the euro traded near two-month lows against the dollar.
A net sentiment-negative outcome to the varied mix of catalysts on offer stands to weigh growth-anchored crude oil and copper prices. Meanwhile, gold and silver may decline as ebbing risk appetite boosts haven demand for the US dollar.
Commodities are likely to find themselves at the mercy of broad-based risk sentiment trends to start the trading week as all eyes turn to the Luxembourg, where euro-zone finance ministers are begin a two-day meeting to discuss debt management efforts.
Commodity prices are on the upswing as markets correct following Friday’s selloff in the wake of a disappointing US jobs report. Overnight data showing Chinese inflation slowed to a 29-month low at 2.2% is reinforcing support, hinting monetary easing.
The new trading week got underway in New York this morning and the price boards in the metals’ complex were once again in the red following Friday’s tepid recovery attempts. Spot gold started off at $1,568.30 with a loss of $4 while silver fell 15 cents to $26.75 per ounce.
Commodity prices are in negative territory overnight, mirroring a selloff across Asian stock exchanges. S&P 500 stock index futures are pointing higher to suggest risk aversion may moderate as markets return toward a neutral setting after Monday’s seesaw volatility.