Gold prices rose on Monday on the back of a subdued dollar as investors considered the prospects of fewer interest rate hikes in the United States this year.
Spot gold was up 0.2 percent at $1,320.45 per ounce as of 0330 GMT, after marking the highest since April 26 at $1,325.96 in the previous session.
U.S. gold futures for June delivery were little changed at $1,320.50 per ounce.
The weakness in dollar is helping gold prices in Asia, a Hong Kong-based trader said.
“Gold is consolidating. The (inflation) data gave people an opportunity to sell the dollar… and gold benefited from that,” the trader said.
The dollar eased 0.1 percent to 92.408 versus a basket of six major currencies, retreating further from its 2018 peak hit last week on the back of sagging U.S. yields, after softer economic data last week curbed prospects of aggressive rate hikes in the United States.
St. Louis Federal Reserve Bank President James Bullard on Friday spelled out the case against any further interest rate increases, saying rates may already have reached a “neutral” level that is no longer stimulating the economy.
Gold is highly sensitive to rising U.S. rates as these tend to boost the dollar and push bond yields up, adding pressure on the greenback-denominated, non-yielding bullion.
While gold prices are likely drawing some support from an ongoing rift between the United States and Iran, investors said easing U.S.- China trade concerns could add downside risks to prices.
Spot gold looks neutral in a range of $1,317-$1,326 per ounce, Reuters technical analyst Wang Tao said.
Holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.62 percent to 857.64 tonnes on Friday.
Speculators raised their net long position in COMEX gold contracts by 636 contracts to 52,621 in the week to May 8, U.S. Commodity Futures Trading Commission (CFTC) data showed.
In other precious metals, silver was up 0.6 percent at $16.71 an ounce, after hitting a 2-1/2-week high in the previous session.
Platinum rose 0.3 percent to $924.50 per ounce, having hit its peak since April 25 at $929.10 on Friday.
Palladium was 0.1 percent lower at $994.70 per ounce, after hitting a 2-1/2-week high at $1,008.50 on Friday. -Reuters