Gold prices fell 0.61% to 95,875 as strong US economic data reduced the likelihood of an immediate interest rate cut by the Federal Reserve. April data showed that personal income in the US rose more than expected and spending and inflation were in line with forecasts. This reduced the attractiveness of non-interest-bearing gold and increased its opportunity cost, leading investors to sell. Open interest fell 5.89% to 13,415,
Geopolitical tensions added to uncertainty. A strong US economy prevented gold from gaining support despite the risk-off mood. In India, demand for gold was weak due to rising domestic prices and the end of the Muhurat season. Prices fell from $49 to $31 an ounce, reflecting less retail interest. In contrast, China’s gold imports hit a 1-year high, although premiums have eased slightly. Global gold demand rose 1% year-on-year in the first quarter of 2025, driven by a 170% increase in investment demand, which offset a decline in currencies and central bank purchases.
