· Gold prices edged lower on Tuesday as the dollar strengthened, while investors cautiously awaited U.S. economic data due later this week to gauge inflationary pressure and the Federal Reserve’s steer on monetary policy.
· Spot gold was down 0.2% at $1,896.20 per ounce, as of 0643 GMT, while U.S. gold futures held steady at $1,898.70.
· The dollar index strengthened 0.1% against its rivals, making gold more expensive for other currency holders.
· “Inflation has been on the rise in recent weeks, and traders are awaiting confirmation from U.S. data this week on continuous strengthening in the price levels,” said Margaret Yang, a strategist at DailyFX, referring to the U.S. consumer price report due on Thursday.
· “This (U.S. data) is expected to have a mixed effect on gold. On the positive side, gold is perceived as an inflation hedge, so the higher the number the more appealing gold will be,” Yang said, adding that more inflation would, however, raise concerns about Fed tapering.
· A weaker-than-expected U.S. jobs report last week has quelled expectations of an early tapering in the Fed’s stimulus.
· Also on the radar, the European Central Bank is expected to hold its policy meeting on Thursday.
· “Gold will struggle to maintain gains above $1,900 an ounce until the U.S. inflation data is out of the way,” Jeffrey Halley, OANDA senior market analyst, said in a note.
· “I expect gold to jump around in a choppy $1,860 to $1,900 range this week, with last week’s high at $1,917 an ounce unlikely to be retested this week.”
· SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.6% to 1,037.33 tonnes on Monday from 1,043.16 tonnes on Friday.
· Among other precious metals, silver fell 0.5% to $27.75 per ounce, palladium was mostly unchanged at $2,834.27, while platinum slipped 0.5% to $1,167.21.
· Shanghai copper eases on U.S. tightening worries, softer China demand
Shanghai copper prices fell on Tuesday, as fears of monetary policy tightening in the United States and softer demand in top consumer China pressured prices.
The most-traded July copper contract on the Shanghai Futures Exchange slipped as much as 0.8% to 71,100 yuan ($11,125) a tonne before closing 0.4% lower at 71,420 yuan.
Three-month copper on the London Metal Exchange edged up 0.2% to $9,921 a tonne by 0717 GMT.
· Supply bottlenecks throttle German industrial output in April
A lack of semiconductors, timber and other intermediate goods drove an unexpected fall in German industrial output in April, a further sign that supply bottlenecks are hampering the recovery in Europe's largest economy.
The Federal Statistics Office said industrial output dropped 1.0% on the month after a downwardly revised increase of 2.2% in March. A Reuters poll had pointed to a 0.5% rise in April.
The drop in the headline figure was driven by a decrease in consumer goods production of more than 3% and a plunge in construction activity of more than 4%.
· U.S. Republicans vow to oppose Yellen’s G7 tax deal, casting doubt on its future
Several top U.S. Senate Republicans on Monday rejected Treasury Secretary Janet Yellen’s G7 deal to impose a global minimum corporate tax and allow more countries to tax big multinational firms, raising questions about the U.S. ability to implement a broader global agreement.
The opposition from Republicans may push President Joe Biden to attempt to use budget procedures to pass the initiatives with only Democratic votes.
· Bank of England launches climate stress test for banks and insurers
· Norway business outlook boosted by reopening after pandemic, says central bank survey
· Brazil 2021 inflation forecasts rise further above cenbank's upper limit -survey
Forecasts for Brazil’s growth and inflation in 2021 rose to new highs, a survey of economists showed on Monday, with inflation moving further above the upper limit of the central bank’s target range for the year.
The median forecast for 2021 inflation from more than 100 economists in the central bank’s weekly FOCUS survey rose to 5.4% from 5.3%, well above the bank’s year-end goal of 3.75% and inching further above the 5.25% upper limit of its wider range.
Following the release of stronger-than-expected first quarter economic growth figures last week, the median 2021 growth forecast jumped to a new high of 4.4% from 4%, the survey showed.
Four weeks ago that stood at 3.2%.
Despite the ninth consecutive rise in the inflation outlook and seventh weekly increase in growth forecasts, economists’ view on interest rates was unchanged.
· Japan finmin says G7 clinches 'historic' deal on minimum global tax
The Group of Seven (G7) advanced countries has struck a "historic" agreement for a minimum global corporate tax of at least 15%, raising momentum for a wider deal among the G20 major economies, Japanese Finance Minister Taro Aso said.
· S.Korea's vaccination drive picks up speed, little slow down in new infections
South Korea injected 857,000 COVID-19 vaccine doses on Monday, setting a daily record in its inoculation drive that took its vaccination rate to 16.4% for a first dose, data from the Korea Disease Control and Prevention Agency (KDCA) showed.
· Free vaccines, food to cost India an additional $11 billion - Bloomberg News
· Thai industries sentiment hits 11-month low in May
Thailand’s industries sentiment dropped for a second straight month in May, hitting an 11-month low, due to a third wave of coronavirus infections and a slow vaccine rollout, an industries group said on Tuesday.
The Federation of Thai Industries (FTI) said its Thai industries sentiment index fell to 82.3 last month from 84.3 in April, when its biggest outbreak so far emerged.
Reference: CNBC, Reuters
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