Gold rose on Monday towards its highest level in 13 months after downbeat Chinese trade data added to concerns about global growth, thereby sparking haven demand on the metal.
The precious metal hit a high of $1276.25 an ounce, slightly below the 13-month high of $1279.45 hit on Friday, while currently trading around $1274.68.
Most Asian shares dropped after a report from China signaled exports plummeted 25.4 percent from a year earlier and imports slipped 13.8 percent to extend declines for the 16th straight month.
The data suggested the world’s second biggest economy would still suffer from slowdown in economic growth despite the measures announced by Chinese officials.
Later in the week, China will release important economic reports, including inflation, industrial production and retail sales.
The U.S. dollar fell for a fifth consecutive session against a basket of major currencies to hover around 97.00, according to the dollar index.
The retreat in the dollar has been one of the key factors helping gold to lock a weekly gain the previous week.
Announcements from Fed officials on Monday were balanced, as Fed Governor Lael Brainard argued for “patience” in raising interest rates, while Fed Vice Chair Stanley Fischer warned that inflation is showing signs of accelerating.
Data released last week showed average hourly earnings dropped for the first time in more than a year, suggesting the Fed would wait before raising interest rates again.
The Fed is not predicted to raise its borrowing cost this month, yet the ECB is anticipated to boost its stimulus and may slash the deposit rate further into negative zones.
