Gold Prices Ease on Reduced Geopolitical Risk

Gold prices retreated as an apparent de-escalation in geopolitical tensions between the US and Iran reportedly dampened safe-haven demand for the precious metal. Market commentary noted that improved risk appetite followed a halt in recent hostilities over the weekend.

US Inflation and Fed Policy in Focus

Analysts are closely watching for potential downward revisions to the US core PCE inflation reading due to methodology changes, a key metric for the Federal Reserve. Market expectations for future Fed rate hikes appear mixed, with some indicators showing fading bets on tightening while other data suggests further rate increases are still being priced in. Investors are also anticipating key US labor market data for further direction on monetary policy.

ECB Signals Confidence Amid Mixed Eurozone Data

European Central Bank President Christine Lagarde commented on the Eurozone's growing economic resilience, suggesting the central bank has greater flexibility to adjust interest rates to address inflation if needed. Despite this confidence, some bank analysts noted that political and growth risks could still present headwinds for the euro, while recent business and economic sentiment data for the region was mixed.