The precious metal gained on news that China increased its gold hoard and Japan's GDP contracted in the second-quarter, albeit slightly ahead of expectations, as the indirect effect allowed the commodity to reaffirm its position as a safe-haven asset.
Weak second-quarter GDP numbers coming out of Japan also provided a boost, and although the contraction was slightly better than expected, investors sought out the lure of gold for some extra safety.
The precious metal received impetus early last week after Federal Reserve (Fed) Vice-Chair Stanley Fischer suggested a rate hike in September may not be on the cards as some other officials had previously indicated. He iterated inflation looks somewhat weak and that rates should not be increased until both sides of policymakers mandate improve.
Gold was up 0.53% and trading at $1,118.30 per troy ounce on Monday, up from its Friday close at $1,115.30. Last week the commodity rallied above the $1,120 threshold for the first time since July 17, leaving the range-bound trading in the dust after the metal dipped to five-year lows of around $1,070 in late July.
Friday's industrial output figures were bullish as well, even though the University of Michigan consumer sentiment slipped a tad. However, the underlying sentiment is that the economy is gaining pace, which is in tune with the Fed's outlook over the past month.
This week on Wednesday will see more details as the July meeting minutes will be released.
