Gold extends decline after solid US economic data
Spot gold fell 0.9% to $3,315.15 per ounce, by 0936 a.m. EDT (1336 GMT) after hitting a session low of $3,309.59.
U.S. gold futures fell 1.2% to $3,320.80.
Following the latest U.S. data, "there was a bit of rise in the dollar and U.S. Treasury yields are higher. So, it's put a little weakness in the gold market," said Bob Haberkorn, senior market strategist at RJO Futures.
But, strong central bank demand, ongoing geopolitical tensions, and tariff risks could keep gold prices elevated, he added.
The dollar gained 0.3%, making greenback-priced gold more expensive for foreign currency holders.
Data showed that the number of Americans filing new applications for jobless benefits fell last week, pointing to steady job growth in July.
While, U.S. retail sales rebounded more than expected in June, recording an increase of 0.6% last month after an unrevised 0.9% drop in May, but some of the increase likely reflected higher prices for some goods exposed to tariffs.
Meanwhile, the Fed should not cut interest rates "for some time" as the impact of Trump administration tariffs begins to pass through to consumer prices, Fed Governor Adriana Kugler said.
Gold is known as a hedge against uncertainty and inflation, but higher rates dim its appeal as it yields no interest.
On the trade front, Japan's top trade negotiator Ryosei Akazawa held talks with U.S. Commerce Secretary Howard Lutnick on U.S. tariffs, as Tokyo races to avert a 25% levy that will be imposed unless a deal is clinched by an August 1 deadline.
Palladium added 0.1% to $1,232.02, after reaching its highest level since October 2023.
Fears of an escalating war in Russia, a major palladium exporter, are fuelling supply concerns and driving prices higher, Haberkorn said.
Elsewhere, spot silver fell 0.8% to $37.64 per ounce and platinum lost 0.6% to $1,408.30.
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