NEW YORK/LONDON: Gold eased in quiet trade on Monday after last week's sharp gain, as investors await Federal Reserve Chairman Ben Bernanke's testimony before US Congress later this week for market cues.
The metal rose overnight after data showed China's economic growth slowed in the second quarter, and later a report showed US retail sales rose less than expected in June.
Bullion investors now focus on Bernanke's semi-annual testimony to Congressional committees this Wednesday and Thursday, which will be watched for further signs about the timing and speed of any reduction in bond purchases.
Gold gained 5 percent last week, its biggest weekly gain in nearly 2 years, after Bernanke said the US central bank needed to keep a stimulative monetary policy in place given an uncertain job market and low inflation.
"Although prices have responded to concerns over growth, in our view, a deterioration in US macro data would be required for prices to make a sustained move higher in light of record gross short positions," said Suki Cooper, precious metals strategist at Barclays Capital.
Spot gold inched down 49 cents to $1,283.80 an ounce by 2:59 p.m. EDT (1859 GMT).
US gold futures for August delivery settled up $5.90 at $1,283.50 an ounce, with trading volume about 30 percent below its 30-day average, preliminary Reuters data showed.
Hedge funds and money managers raised bullish bets in gold and futures and options for a second straight week, as signs of tight physical supplies sparked buying, a report by the Commodity Futures Trading Commission showed on Friday. However, speculators also boosted their short position to a record high.
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