Gold steadies near 4-month low as dollar gains in wake of US data

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Gold prices steadied on Monday after falling to a near four-month low in the previous session, with the dollar gaining in the wake of indications that US economic growth picked up in the first quarter.

Spot gold was up 0.1 percent at $1,275.80 per ounce as of 0111 GMT, having touched $1,270.63 in the previous session – its lowest since Dec. 27, 2018.

Spot gold fell 1.2 percent in the previous week, marking its fourth consecutive weekly decline. US gold futures were 0.1-per cent higher at $1,277.80 an ounce.

The dollar drifted higher against the euro and British pound on Monday, supported by the relative strength of the US economy, though moves remained small as many investors were still away for the long Easter weekend.

US retail sales increased by the most in 1-1/2 years in March as households boosted purchases of motor vehicles and a range of other goods, the latest indication that economic growth picked up in the first quarter after a false start, data showed on Thursday.

A top Federal Reserve policymaker on Thursday said he is “getting more confident” in US economic growth this year but still thinks current interest rates are appropriate.

Businesses across the euro zone stumbled into the second quarter as demand remained weak despite more modest price rises, surveys showed on Thursday.

Asian stocks were steady on Monday as investors awaited the return of major financial markets from the Good Friday holiday, while oil prices spiked on a report the US is likely to ask all importers of Iranian oil to end their purchases or face sanctions.

Hedge funds and money managers switched to a net short position in COMEX gold in the week to April 16, the US Commodity Futures Trading Commission (CFTC) said on Friday.

SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.16 percent to 751.68 tonnes on Thursday from 752.86 tonnes on Wednesday.

Gold premiums in top consumer China jumped to their highest in more than two years, as a drop in global prices and strengthening yuan encouraged purchases amid optimism about the state of the economy.

Russia’s gold reserves stood at 69.7 million troy ounces as of the start of April, the central bank said on Friday.

The US Attorney’s Office said it has agreed not to prosecute one of the country’s biggest gold refineries, Republic Metals Corporation (RMC), after an investigation into possible money laundering.

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