Market News

By Anushree Mukherjee and Anmol Choubey

(Reuters) - Gold prices hit an over one-month low on Thursday as investors await a key U.S. inflation print for cues on the Federal Reserve's monetary policy path, while thawing U.S.-China trade tensions also weighed on bullion's appeal.

Spot gold was down 1.3% to $3,136.97 an ounce as of 0536 GMT, after hitting its lowest level since April 10 earlier in the session.

U.S. gold futures fell 1.5% to $3,140.00.

The U.S. and China agreed to reduce tariffs drastically and adopted a 90-day pause, de-escalating a potentially damaging trade war between the world's two largest economies.

"The outlook for intraday today is weak for the yellow metal as the positive talks between the U.S. and China has eroded safe haven appeal," said Jigar Trivedi, senior commodity analyst at Reliance Securities.

"The dollar index is making an attempt to rebound and in case the U.S. posts better retail sales and PPI data, there could be more pain in the yellow metal."

The spotlight is now on the U.S. producer price index (PPI) data, due at 1230 GMT, following softer-than-expected consumer data earlier this week.

Fed policymakers are leaving interest rates where they are while they try to assess how U.S. President Donald Trump's tariffs and trade negotiations will affect prices and the economy. So far, the hard data is giving them little to go on.

Fed Chair Jerome Powell is also set to deliver a speech later in the day.

Markets are expecting 50 basis points of interest rate cuts this year, with the reductions now seen starting from October instead of July.

Gold, traditionally seen as a hedge against economic and political uncertainties, thrives in a low-interest-rate environment.

Spot silver was down 1.5% to $31.74 an ounce and palladium fell 0.3% to $947.81, while platinum rose 0.4% to $979.64.

(Reporting by Anushree Mukherjee and Anmol Choubey in Bengaluru; Editing by Sherry Jacob-Phillips, Eileen Soreng and Varun H K)