Gold prices rebounded on Monday from a near four-month trough hit in the previous session as investors resumed trading after the Easter holiday, with the bullion gaining further traction on higher crude rates.
Spot gold was up 0.4 percent at $1,279.48 per ounce, as of 0325 GMT, having touched $1,270.63 in the previous session — its lowest since Dec. 27, 2018.
The metal dropped 1.2 percent in the previous week, marking a fourth consecutive weekly decline.
U.S. gold futures were 0.5 percent higher at $1,281.70 an ounce.
“Gold prices last week have suffered from a very sharp decline, for now what is happening is just technical buying, with some people coming and pushing prices up,” said Benjamin Lu, analyst, Phillip Futures.
Also adding to the metal’s gain was a rally in oil prices due to mounting tensions between the United States and Iran, with the former expected to announce a blanket ban of Iranian oil imports worldwide.
“Gold has climbed slightly … benefiting from higher oil prices driven by geopolitical tensions. With regional equity markets possibly coming under pressure today as a result, gold could be a principal beneficiary in today’s session,” Jeffrey Halley, a senior market analyst with OANDA, said in a note.
However, capping gains for the metal was an upbeat dollar, which gained against the British pound after data showed that United States’ economic growth might have picked up in the first quarter.
U.S. retail sales increased the most in 1-1/2 years in March, the latest indication that economic growth picked up in the first quarter after a false start, data showed on Thursday.
Gold is positively correlated to oil as the metal is often seen as a hedge against oil-led inflation, while a stronger greenback makes dollar-denominated gold more expensive for holders of other currencies.
Meanwhile, investors continue to cut their exposure to gold. Speculators switched to a net short position in COMEX gold in the week to April 16, the U.S. Commodity Futures Trading Commission (CFTC) said on Friday.
Also, holdings of SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, dropped to 751.68 tonnes on Thursday, the lowest levels seen since Oct. 26.
Elsewhere, silver rose by nearly 1 percent to $15.07 per ounce.
Platinum gained 0.5 percent to $905.40. Earlier in the session, the metal hit its highest level in over a week at $906.80.
Palladium was steady at $1,422.19, having earlier climbed to its highest in over two weeks at $1,424.50.