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Bloomberg
Gold dropped — following four straight weeks of gains — as investors assessed signs China’s economy is struggling to recover ahead of minutes from the Federal Reserve later in the week.
Bullion fell 1.1%, after the longest run of weekly gains in almost a year, as it came under pressure from the stronger dollar. The precious metal has gained amid cooling inflation in the US, which backs the case for the Fed to be less aggressive in raising borrowing costs.
China’s central bank unexpectedly cut its key interest rate as it ramped up support for an economy weighed down by virus lockdowns and a deepening property crisis.
Economic data showed the country’s recovery is ebbing, potentially crimping physical demand for gold in the world’s largest consumer.
Traders will be looking to the release of minutes from the Fed’s July meeting on Wednesday, which may offer clues as to what conditions would prompt the US central bank to go big with tightening yet again in September. Bets in financial markets on the size of the next increase have swung between 50 and 75 basis points.