Gold has been looking for direction since its pullback on Friday.
The precious metal starts the week mostly flat after the market reacted to the release of the US Personal Consumption Expenditures (PCE) data from last week, which indicated stable US inflation.
This development sparked a shift in expectations toward a September interest rate cut although Fed members continue to stress the need to maintain a tight monetary policy.
This week is packed with significant economic events that will keep investors on their toes, including, later today, the US Manufacturing PMI, the Bank of Canada’s decision on Wednesday, and the European Central Bank meeting on Thursday.
However, gold could come under pressure if its appeal as a safe haven diminishes amidst prospects of easing tensions in the Middle East, especially with the recent optimism surrounding President Biden’s proposed ceasefire plan for Gaza.
At the same time, risks remain as geopolitical tensions could flare up again.
