By Gina Lee
Investing.com – Gold was down on Monday morning in Asia, but remained near a one-week high. A sharp drop in U.S. consumer sentiment reduced concerns about early asset tapering by the U.S. Federal Reserve and gave the yellow metal a small boost.
Gold futures inched down 0.04% to $1,777.55 by 12:02 AM ET (4:02 AM GMT), after hitting its highest level since Aug. 6, or $1,780.82, earlier in the session.
Data released last Friday said consumer sentiment dropped to its lowest levels since 2011. The Michigan consumer expectations for August was 65.2, while the Michigan consumer sentiment was 70.2.
The data pared bets that the Fed will introduce asset tapering and interest rate hikes earlier than expected. Further data, including core retail sales and retail sales, will be released on Tuesday.
Investors now await Fed Chairman Jerome Powell’s comments at a virtual town hall meeting with educators and students on Tuesday, as well as the minutes from the Fed’s last policy meeting which will be released a day later.
In Asia Pacific, the Reserve Bank of Australia and the Reserve Bank of New Zealand will release the minutes from the latest meeting and the latest policy decision on Tuesday and Wednesday respectively.
Chinese data released earlier in the day also disappointed. Industrial production rose 6.4% year-on-year in July, while retail sales grew 8.5% year-on-year in the same month.
However, gold premiums in China and India, a fellow top consumer, rose to multi-month highs. Physical gold demand rose during the previous week, with consumers picking up bargains after prices fell across regions.
The geopolitical implications from the Afghan government’s collapse over the weekend are also on investors’ radars.
In other precious metals, silver edged down 0.2%, platinum fell 0.7% and palladium was down 0.4%.