Gold prices remained little changed on Thursday, a day after a slight dip following stronger-than-expected U.S. retail sales.
Markets continue to be uncertain about future U.S. monetary policy despite easing inflation, according to traders.
The precious metal fell marginally on Wednesday after two consecutive sessions of solid increases. The declines came as the dollar recovered from a 2-and-a-half-month low and Treasury yields slowed their recent slide.
Spot gold rose to $1,966.40 per ounce by mid-morning after hitting a low of $1,955.52 the previous session.
Overnight data showed U.S. retail spending stayed resilient last month, somewhat dampening optimism from the recent cooling in inflation. Prices still sit well above the Fed’s 2% target.
The retail figures helped the dollar and yields rebound, putting pressure on gold and pausing its two-day climb.
Weaker inflation reports earlier this week increased bets the Federal Reserve was finished hiking rates. But the retail numbers led some to doubt rates will stay elevated for longer.
Fed officials recently reiterated rates will be higher for longer, even as they signal a data-dependent approach.
Such an outlook is negative for gold, as higher rates raise the opportunity cost of holding non-yielding bullion. This has capped major gains this year, keeping prices solidly below $2,000 an ounce.