Markets await US PCE price index, Q3 GDP data this week
Palladium up 3

Oct 23 Reuters Safehaven gold eased on Monday, hitting pause after jumping to within striking distance of the key 2,000 level in the last session, as traders positioned for further developments on the Middle East conflict and U.S. economic data.

Spot gold fell 0.3 to 1,976.19 per ounce by 141 p.m. ET 1741 GMT. U.S. gold futures settled 0.3 lower at 1,987.80.

Safehaven demand will continue to drive gold higher after a slight period of consolidation. We believe geopolitical tensions and the uncertainty in the Middle East will continue to drive prices higher, said David Meger, director of metals trading at High Ridge Futures.

Bullion has surged about 9 in the past two weeks as investors sought to hedge against risks of a wider escalation in the IsraelHamas war.

However, while not a negative signal, it is a red flag and that momentum in gold that previously existed has not been restored in early trade this week which could lead to some profittaking, said Craig Erlam, senior markets analyst at OANDA in a note.

Focus is also on the U.S. PCE price index on Friday the Federal Reserve39;s favoured inflation gauge and U.S. GDP figures for the third quarter on Thursday.

If inflation data come in higher than expected, it will raise concerns about rising interest rates, to which gold might see a kneejerk reaction to the downside, but safehaven demand should begin to kick in post that, Meger added….