Gold is starting the week trading mostly unchanged as the support from expectations for higher inflation was offset by a strengthening in the US dollar over hopes of rapid economic recovery, which shares a negative correlation with the yellow metal. At the time of writing, GOLD is trading at a little above $1,722.

The US dollar turned even more bullish after the latest employment report for March showed a greater than expected jump in jobs across the US economy. This reinforced expectations that the world’s most powerful economy could post a speedier rebound from the coronavirus crisis, sending investors away from the safety of gold as well as from other riskier currencies and towards the greenback.

However, gold prices received some support from worries that President Biden’s plans to unveil more stimulus could send inflation higher in the US. Last week, Biden laid out his plans to invest $2 trillion to boost America’s infrastructure, but while these initiatives can speed up recovery, it could also send inflation higher – and with gold being considered as a hedge against inflation, prices are enjoying some support from this possibility for now.

Even as the US posts solid data indicating rapid economic recovery, the yellow metal’s safe haven appeal remains strong on the back of escalating worries about the impact of the latest wave of lockdowns on European economies. In addition, with important emerging markets like India and Brazil reporting a spike in fresh coronavirus cases, there are concerns that economic activity across these regions could also be hampered shortly.