Investing.com - Gold prices fell further in Asia on Monday with Japan's economy showing a fourth quarter slump, but copper gained smartly despite weak China trade data.
Gold for February delivery on the Comex division of the New York Mercantile Exchange fell 1.66% to $1,218.80 a troy ounce.
Silver futures dropped 2.44% to $15.405 a troy ounce, while copper futures gained 1.77% to $2.070 a pound.
China reported trade data for January with exports slumping 11.2%, compared to an expected 1.9% year-on-year drop, and imports crashing 18.8%, compared to a 0.8% decline seen, for a trade balance surplus of $63.29 billion, wider than the $58.85 billion expected.
Earlier, data showed Japan's GDP contracted 0.4% quarter-on- quarter, or an annualized 1.4%, in the fourth quarter, hit by sluggish consumer spending amid a slow wage recovery and uncertain growth prospects. An unexpected rise in business investment was outweighed by declines in other key components of the gross domestic product.
Markets in both the U.S. and Canada will be closed for national holidays.
In the week ahead investors will be watching U.S. inflation data for indications on whether the Federal Reserve will raise rates at all this year. As well, European Central Bank President Mario Draghi is to testify on monetary policy before the European Parliament's Economic and Monetary Affairs Committee, in Brussels.
During the break, China's central bank governor Zhou Xiaochuan said in an interview at the weekend there is no basis for continued yuan depreciation.
In an wide-ranging interview with financial magazine Caixin, Zhou spoke during a week-long holiday in China with markets shut, warning the PBOC won't allow speculators to dominate market sentiment, and downplayed concerns over the sharp decline in the country's foreign-exchange reserves over the past few months.
Also on Monday, in Japan, capacity utilization for December month-on-month is due as well as industrial production expected down 1.3%. The country reported that the tertiary industry activity index fell 0.8%, compared to an expected gain of 0.1%.
Last week, gold prices declined on Friday, as global equity markets recovered, but the precious metal still scored its best week since late 2008, boosted by a flight to safety.
Wall Street closed sharply higher on Friday, with the Dow gaining more than 300 points to snap a five-day losing streak, as financial and energy shares rallied. U.S. equities fell sharply Thursday amid a global selloff, with the Dow falling more than 250 points.
Other traditional safe havens also fell out of favor on Friday, including U.S. and German government debt as well as the Japanese yen.
Meanwhile, investors digested data on U.S. retail sales, which rose 0.2% in January, above the 0.1% gain expected. Import prices in the U.S. fell 1.1%, less than expected. Other data points due Friday included consumer sentiment, which came in below expectations, and business inventories, which rose 0.1% in December.
Investors also reacted to comments from New York Fed President William Dudley, in which he said the key components of the U.S. economy remain healthy.
Fed Chair Janet Yellen said Wednesday that financial conditions have become less supportive to growth as foreign developments pose risks to the economic outlook, but also maintained that moderate growth at home would justify "gradual adjustments" to the Fed's monetary policy stance.
A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.
Gold futures have been well-supported in recent weeks amid indications global economic and financial headwinds could make it tough for the Fed to raise interest rates as much as it would like this year. Market participants have all but priced out any rate hikes this year, while the Fed is anticipating four more.