Earlier in the North American session, gold prices made a slight recovery after US economic data showed a slowdown in factory gate inflation and weakened consumer spending due to US tariffs. Currently, the XAU/USD pair is trading at $3,202, up by 0.82%. After falling to a five-week low of $3,120, the non-yielding metal saw an increase in buying which pushed its price back above $3,200. Data from the US revealed that the April Producer Price Index (PPI) unexpectedly fell by -0.5% on a monthly basis, missing expectations of a 0.2% increase. The core PPI also dropped by -0.4%, below an anticipated 0.3% expansion. At the same time, Retail Sales for the same period slowed down, rising only 0.1% on a monthly basis after March’s figures were revised upward to 1.7%. This was below expectations of remaining unchanged from the previous month. The Initial Jobless Claims for the week ending May 10 remained steady at 229,000, as expected. XAU/USD saw an upward trend following this data, with bulls managing to regain the $3,200 level as the US Dollar Index (DXY) declined by 0.15% to 100.88. Traders also increased their bets on the possibility of the Federal Reserve easing policy by 53 basis points in 2025, up from the expected 48.5 on Wednesday. As risk appetite improved with the de-escalation of the US-China trade war, the price of gold was impacted and fell from $3,326 to $3,207, experiencing a loss of over $120. However, it has since rebounded as US data suggests a slower economy. Looking ahead, the US economic schedule will include more Fed speaking engagements and the University of Michigan (UoM) Consumer Sentiment. From a technical perspective, the bounce in gold prices may be temporary if buyers are unable to achieve a daily close above $3,200. In that case, they would need to surpass the May 14 peak of $3,257 to maintain hopes of testing $3,300 and reducing weekly losses. However, the momentum currently favors further downward movement, as indicated by the Relative Strength Index (RSI). Therefore, it is crucial for traders to be aware that the current uptrend may just be a correction of the overall downtrend. On the other hand, if XAU/USD closes below $3,200 on a daily basis, further declines are expected, with the 50-day Simple Moving Average (SMA) at $3,155 being the next support level, followed by $3,100.