Gold prices have been hit hard

Gold prices have been hit hard, following a sharp rally over the weekend as traders await further clarity from the Trump administration on its gold import tax policy.

The commodity had been exempted from the tax since April, but investors are still waiting for clearer signals on its long-term direction.

Joseph Cavatoni, senior market specialist for North America at the World Gold Council, said that different segments of the gold market are operating stably while waiting for further information.

According to Jim Wyckoff, senior analyst at Kitco Metals, the market rallied last week on the uncertainty surrounding tariffs, but is now seeing a sell-off as investors await more clarity from the White House.

On the economic data front, the US will release the consumer price index (CPI) on Tuesday and the producer price index (PPI) on Thursday. Wyckoff said that inflation data this week is particularly important after the weak jobs report. If the numbers come in higher than expected, the US Federal Reserve (Fed) could pause its interest rate cut plan in September, which would put downward pressure on gold prices.