Mubasher: Gold prices fell on Tuesday as risk-on sentiment remained supported by expectations of global stimulus measures and progress in the trade talks between the US and China, Reuters reported.
By 9:23 am GMT, spot gold fell by 0.29% to $1,494.75 per ounce, after hitting $1,486 earlier in the session, which is the lowest level since 13 August, while US gold futures dropped by 0.58% to $1,502.30 per ounce.
The yellow metal lost around 5% of its value since it recorded more than 6-year peak of $1,557 on 4 September.
Official figures from China showed consumer price index (CPI) at the same pace for two months, which came above forecasts.
In addition, the producer price index (PPI), a key gauge of profitability of companies, declined less than expected, which will prompt Beijing to boost economic stimulus, as its conflict with the US escalates.
Market participants are now focusing the European Central Bank’s (ECB) meeting on Thursday for hints on monetary policy easing.
While the ECB is set to launch a package of monetary easing and stimulus measures, markets are cynical that it will choose massive quantitative easing.
In the US, the Federal Reserve is also widely expected to trim its interest rates next week.
In addition, US Treasury Secretary Steven Mnuchin on Monday ruled out the threat of a recession, as President Donald Trump pushes to revive trade talks.
“A resumption in US-China trade talks along with accommodative monetary policy by global central banks has renewed risk appetite for the current term,” a note by Phillip Futures was quoted by Reuters.