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Gold drops as China’s PBOC halts buying
China's PBOC reported unchanged gold holdings in May, ending an 18-month buying streak.
Market watchers await the U.K. jobs report on Tuesday for signs of easing wage pressures and potential BOE rate cuts.
April GDP data on Wednesday is expected to show a slowdown after a 0.6% growth in Q1.
EUR/USD opened lower amid the European People's Party holding most seats and Macron's snap election announcement.
In currencies
The GBP/USD nudged lower to 1.2720, amid the dollar strengthening on better-than-expected NFP data.
Market participants will be paying close attention to the upcoming U.K. jobs report on Tuesday. They aim to determine if wage pressures are decreasing quickly enough to make a Bank of England rate cut a plausible near-term option.
Additionally, the April GDP data, set to be released on Wednesday, is anticipated to indicate a slowdown in growth following a strong 0.6% expansion in the first quarter.
Moreover, the EUR/USD opened on a gap to the downside as the centre-right European peoples party are set to hold the most seats and Macron announcing a snap election to take place on June 30.
In Commodities
Gold drops more than $90 on Friday after The People's Bank of China reported on Friday that its gold holdings remained unchanged in May, halting a buying streak that lasted for a year and a half. Causing a blow to the recent surge in gold prices, which have reached all-time highs partly due to substantial purchases by central banks, mainly from China.
The World Gold Council reported that the first quarter of 2024 saw the largest increase in gold purchases by global central banks since records began in 2000, with China leading this trend.
Since November 2022, China's central bank has been steadily increasing its gold reserves, with April marking the 18th consecutive month of acquisitions, albeit with the smallest addition in that period. The most recent data shows that the PBOC's gold holdings remained unchanged in May at 72.8 million ounces, the same level as in April.
