Gold futures are trading slightly higher Monday after losing 3% last week and falling to the lowest level since 12 August.
At 12 pm EDT, December Comex Gold Futures were trading at $1,759.60 (£1,287.90) an ounce, up 0.26% or $4.66 from Monday's opening.
While the precious metal is showing signs of a turnaround, it’s well below the summer's trading high of $1,909.90 on 2 June.
Gold fell last week to a five-week low after the US Census Bureau said advance monthly sales grew 0.7% in August compared to declining 1.8% in July. The August number was also 15.1% above August 2020.
The report raised the assumption among some investors that the Federal Reserve Board could taper its stimulus sooner than expected, driving Treasury yields higher and rallying the US Dollar. The Fed holds a two-day meeting this week.
Last week, the 10-year US Treasury note saw its highest yield since 14 July. An increase in yield normally translates into a higher cost of holding non-yielding assets.
Additionally, the August US Consumer Price Index saw the smallest seasonally adjusted percentage increase in seven months, up 0.3% from July.
One issue that may drive gold prices is the so-called Fear Index, a popular measure of the expected volatility based on S&P 500 stock options. The Chicago Board Options Exchange’s VIX index jumped more than 29% to 26.93.