Gold will stabilize as the dollar softens and trendline support is retained
Spot Gold has found some stability after hitting its lowest point since April 10, thanks to technical buying and a weaker US dollar. It has support around $3,130, near a trendline that has held since 2025. The dollar index dipped by 0.3% to 100.81, making gold more appealing to holders of other currencies. Even with Thursday’s dip, the index is still on track for a slight weekly gain, but it remains down nearly 7% for the year.
Investor focus changes to US inflation and retail data
Markets are bracing for several crucial US economic reports, including data on the producer price index, retail sales, and weekly unemployment claims. These figures could shape expectations for interest rates in the latter half of the year. Notably, the CPI data released on Tuesday was weaker than anticipated, with core inflation rising only 0.2% in April. Fed Chairman Jerome Powell is also set to speak later Thursday, and traders are keen to analyze his comments for clues about future Fed policy. Currently, the market is pricing in a 50 basis point cut by year’s end, likely starting in October.
US-China trade ceasefires weaken demand for safe shelters
Gold’s status as a safe haven has diminished somewhat following the agreement between the US and China to pause 90-day tariffs. While trade tensions remain, this development has reduced the immediate need for gold as a hedge. As the demand for safe-haven assets slackened, Treasury yields increased early in the week, putting pressure on gold before it stabilized on Thursday.
