Spot gold was unchanged at $4,691.12 an ounce by 21:21 ET (01:21 GMT) on Thursday, after retreating in the two previous sessions. U.S. Gold Futures slipped about 0.2% to $4,697.97.
Investors were cautious ahead of a scheduled summit in Beijing between U.S. President Donald Trump and Chinese President Xi Jinping, where the agenda is expected to include trade ties, the Iran conflict and global supply chain risks. Market participants said they were watching the meeting for any signs that the two leaders might reduce geopolitical tensions that have unsettled commodities and currency markets in recent weeks.
Gold, often sought as a hedge against geopolitical risk, drew some buying interest from sustained concerns over the Middle East conflict and reported disruptions around the Strait of Hormuz - a critical transit point for global oil shipments. That support was tempered, however, by stronger U.S. inflation readings and a firmer U.S. dollar.
U.S. producer prices accelerated in April at the fastest pace since 2022, and consumer inflation rose more than expected as higher energy costs linked to the Iran conflict filtered through the economy. Those inflation data reinforced expectations that the Federal Reserve could keep interest rates higher for longer, reducing demand for non-yielding assets such as gold.
The U.S. Dollar Index was trading near a two-week high following the inflation releases, exerting pressure on bullion by increasing its cost for overseas buyers.
Oil prices remaining above $100 a barrel continued to be a focal point for markets. Traders warned that prolonged supply disruptions in the Gulf region could amplify global inflationary pressures, a dynamic that undercuts gold's appeal despite its safe-haven status.
Market participants also took note of policy changes in one of the world's largest physical bullion markets. India raised import duties on gold and silver in a move intended to limit overseas purchases of the metals and help shore up the country's foreign exchange reserves. That measure could dampen physical demand in India.
Other precious metals posted small moves on the day - silver inched up 0.1% to $87.66 an ounce, while platinum rose about 0.3% to $2,141.60 an ounce.
Market context
In the near term, gold's price trajectory appears tied to two competing forces: geopolitical-driven demand for safe havens and macroeconomic signals that suggest tighter U.S. monetary policy. The outcome of the Trump-Xi discussions and the path of energy prices will likely remain central to how bullion performs in coming sessions.