Gold is down by 2.02%

Gold decreased 2.02% to 4890.35 USD/t.oz

Gold dropped more than 1% to around $4,920 per ounce on Tuesday, marking a second consecutive session of losses, amid thin trading volumes due to local public holidays in key markets. Markets in China and several countries in Asia remained shut for the Lunar New Year, following a holiday in the US on Monday. Meanwhile, softer-than-expected US inflation data released last Friday boosted expectations for further monetary easing by the Federal Reserve this year. Traders are currently pricing in slightly more than two rate cuts, with July seen as a potential starting point. Investors are now awaiting the Fed’s meeting minutes, the advance estimate of US GDP, and PCE inflation data for clearer guidance on the policy outlook. Geopolitical developments also remain in focus. US-Iran nuclear talks are set to resume later today amid elevated tensions, while negotiations between Russia and Ukraine are also scheduled to begin against the backdrop of ongoing fighting.

Gold fell to around $5,020 per ounce on Monday as some investors took profits after prices rose 2.5% in the previous session driven by weaker-than-expected US CPI data. The soft inflation print reinforced expectations for more Federal Reserve rate cuts, with markets now pricing in slightly more than two reductions this year. Investors are awaiting the release of FOMC meeting minutes, the US GDP advance estimate, and PCE inflation data for further clues on the timing of the next rate cut. On the geopolitical front, traders are monitoring nuclear talks between the US and Iran and US-led negotiations aimed at ending the war in Ukraine, both scheduled to resume on Tuesday. Developments in these areas could influence risk sentiment and safe-haven demand. Despite recent volatility, the precious metal remained supported by geopolitical uncertainty, strong central bank buying, and investor flight from sovereign bonds and currencies.