The yellow metal is bullish at the start of the London session as a weakening dollar is giving it a boost. Investors are now looking to U.S. economic data due later in the week to get an idea of when the U.S. Federal Reserve will begin asset tapering.
Gold futures is up by 0.33%, currently trading at $1,818.20 an ounce. The dollar index, which usually has an inverse relationship with the yellow metal, is down by 0.16%, currently trading at 92.502 points, trading near a two-week low.
The dollar stabilized from its fall after Fed Chairman Jerome Powell did not provide a clear timeline for asset tapering and interest rate hikes during the previous week’s Jackson Hole meeting. He only suggested that the asset tapering timeline could be “within 2021.” However, Fed President Loretta Mester stated that she is not yet convinced that recent inflation readings will be enough to satisfy the conditions to begin asset tapering, despite the economic recovery from COVID-19.
In Asia Pacific, data released earlier in the day showed a slowdown in China’s factory activity in August. The manufacturing purchasing managers’ index (PMI) is at 50.1 and the non-manufacturing PMI is at 47.5, below the 50-mark indicating growth. The world’s second-largest economy is still feeling the impact of recent strict lockdowns to curb the latest COVID-19 delta variant outbreak in the country as well as high material prices.
Investors now anticipate the latest U.S. jobs report, including non-farm payrolls (NFP), that will be released on Friday. But the prospects look grim as data released on Monday showed that pending home sales fell 1.8% month-on-month in July.
In other precious metals, silver is up 0.92%, currently trading at $24.23, platinum is up 0.43%, currently trading at $1,007.25 and palladium is up 0.32%, currently trading at $2,497.50, as of the time of writing this report.