United States data, Federal Reserve talks prod XAU/USD bulls

While tracing the latest rebound in the US Treasury bond yields and the US Dollar, the United States statistics and comments from the Federal Reserve (Fed) officials gain major attention.

On Friday, US Retail Sales dropped by 1.0% for March versus -0.4% expected and -0.2% prior. On the contrary, Industrial Production grew by 0.4% during the stated month compared to 0.2% market forecasts and prior reading. Additionally positive was the preliminary reading of the University of Michigan's (UoM) Consumer Confidence Index for April which improved to 63.5 versus 62.0 analysts’ expectations and previous readings. Furthermore, Year-ahead inflation expectations rose from 3.6% in March to 4.6% in April while its Five-year counterpart reprinted 2.9% for the said month.

“The recent developments are consistent with one more rate hike,” said Atlanta Federal Reserve (Fed) President, Raphael Bostic in an interview with Reuters this Friday. On the same, Fed Governor Christopher Waller mentioned that the recent data show that the Fed hasn't made much progress on its inflation goal and added that rates need to rise further, per Reuters.

However, Federal Reserve Bank of Chicago President Austan Goolsbee said in interview with CNBC on Friday that he still want to see the data. The policymaker also added, “But let's be mindful we've raised a lot; some of the lag is coming through possibly in today's retail sales number."

Given the resilient data and the Fed policymakers’ hesitance of being dovish, the market’s bets for the 0.25% Fed rate hike in May increased. That said, the traders also push back the expectations of a rate hike curing the current year.

As a result, the Gold price run-up pauses near the multi-month high and challenges the bulls of late.