The reason behind a better tone around the precious metal is the local dollar weakness which came amid a spectacular euro recovery due to easing political tensions in Italy. Weaker-than-expected US GDP and ADP employment data also added to the pressure on the buck which remains on the defensive today.
Against this backdrop, the metal has a chance to confirm the recovery, should the greenback proceed with its bias. This scenario could be implemented if the dollar remains under pressure and accelerates the retreat, should the US PCE index come in lower than expected. However, in the longer term, the yellow metal remains vulnerable to downside risks.