Gold prices fluctuated after three consecutive increases, as investors awaited a series of bulging economic data to be released after the US government ended the longest closure in history.
The precious metal was traded around $4,100 an ounce, after easing the gains it had made early in the fourth session. The latest private-use data shows that the US labor market is weakening, increasing the possibility of the Federal Reserve (FED) continuing to cut interest rates.
However, investor sentiment remains cautious as the more than 40-day government shutdown is approaching its end. After the Senate approved a temporary spending package backed by eight Democratic Senators, the reopening now depends on the Republican-controlled lower house, which is expected to meet again on Wednesday to consider the proposal. The USD increased slightly after five consecutive sessions of decline.
Gold prices have corrected from a record of more than $4,380 an ounce reached last month, when investors took profits after the rally that was considered too fast, too strong. According to Bloomberg data, ETFs investing in gold have recorded three consecutive weeks of net withdrawals - marking a clear reversal in capital flows into this precious metal.
However, gold which has risen more than 55% since the beginning of the year is still on track to record its strongest annual gains since 1979, supported by many factors, including strong central bank buying.
According to Ms. Hebe Chan, an analyst at Vantage Markets (Melbourne), the recent recovery of gold prices exceeding the 4,100 USD/ounce mark reflects the potential uncertainty under the optimism surrounding the US government's reopening.
The chain effects of the longest government shutdown in US history may have left a lasting impression, maintaining safe-haven demand for gold despite the overall market sentiment being more positive, she said.
The resumption of economic data release could further strengthen expectations that the Fed will soon cut interest rates a favorable factor for gold, which is not a yield-making asset.
Ms. Charu Chanana, chief strategist at Saxo Markets (Singapore), said that gold prices may continue to move sideways before rebounding in 2026.
C appeal could shift from overbought assets like gold and AI stocks to less-watched sectors, she said.
As of 1:43 p.m. this afternoon in Singapore, gold prices fell 0.5% to $4,104.45/ounce. The Bloomberg Dollar spot rose 0.1%, while silver, platinum and paladi all fell slightly.
