Gold price (XAU/USD) struggles to capitalize on its goodish intraday bounce from the $2,972-2,971 area, or a nearly four-week low touched earlier this Monday and trades with modest intraday losses heading into the European session. Data published earlier today showed that the People’s Bank of China (PBOC) increased its state Gold reserves for the fifth straight month. Apart from this, the prevalent risk-off mood, amid recession fears, and geopolitical risks, act as a tailwind for the commodity.
Meanwhile, the US Dollar (USD) kicks off the new week on a weaker note amid bets that a tariffs-driven US economic slowdown might force the Federal Reserve (Fed) to resume its rate-cutting cycle soon. Adding to this, the anti-risk flow leads to a further steep decline in the US Treasury bond yields, which overshadows Friday’s upbeat US Nonfarm Payrolls (NFP) report and Fed Chair Jerome Powell’s hawkish remarks. This turns out to be another factor supporting the non-yielding Gold price.
The intraday recovery, however, lacks follow-through as investors continue to unwind their XAU/USD bullish positions to cover losses from a broader sell-off across the global financial markets. This, in turn, warrants some caution before confirming that the recent sharp corrective pullback
