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As momentum continues to build, analysts are eyeing the $1,950 an ounce level and gold's eventual return to record highs.

"There's no sense in fighting a trend like the one that's ongoing in gold," Forexlive.com chief market strategist Adam Button told Kitco News.

* Analysts cited a weaker U.S. dollar, higher inflation, crypto volatility, and a seasonal uptrend as the reasons behind their optimism.

* Gold is an excellent safe-haven play in this environment, said Walsh Trading co-director John Weyer.

"Gold will slowly drift higher. If there are inflationary fears out there, gold will be a welcome spot for people to go. One thing we have to keep an eye on is the U.S. dollar. If the dollar starts flirting with 93-94 areas, it will be tough for gold to continue. Around 90 on the U.S. dollar index is good for gold and good for exports," Weyer said.

* A lot of people disagree with the Federal Reserve that inflation is transitory, said Phoenix Futures and Options LLC president Kevin Grady.

"Inflation will be here for a while. That is the underlying driver for gold right now. Just look at the prices. Plus, the passing of Biden's infrastructure bill will boost demand from the public sector, causing prices to explode. Lumber, copper, steel are already so high," Grady said.

Crypto flattening out is also helping gold, he added. "There's definitely a correlation there," Grady noted.

* Some analysts, however, did note that gold might have gone a bit too far and is due for a move lower. "Gold is overdue for a pullback, having moved over $200 over the past three months without a meaningful pullback. When such a consolidation comes depends largely on who is buying. If it is banks getting ahead of Basel III, then they are not price-sensitive but time-sensitive, so gold could well move up for the next couple of weeks," said Adrian Day Asset Management president Adrian Day.

* Stronger U.S. dollar and rising U.S. Treasury yields could be the main obstacles in gold's move higher. "The rise in U.S. yields seemed to steal its thunder after $1,900 was briefly taken out. The dollar may also find some better traction," said Bannockburn Global Forex managing director Marc Chandler.

* Some see gold as simply overbought at the $1,900 level, which could lead to some profit-taking. "I'm going to stubbornly stick with the idea the August contract is overbought short-term and in position for a move to a new downtrend on its daily chart. Heading into next week, initial support is at the previous 4-day low of $1,875.40, then Friday's low (so far) of $1,884.30. A break below one of these marks could trigger renewed short-term selling interest," said Darin Newsom Analysis Inc. president Darin Newsom.

· Economy can handle the sharp rise in inflation, market bull Ed Yardeni predicts

· EXCLUSIVE G7 to back minimum global corporate tax and support economy – draft

Finance ministers from the group of seven rich nations (G7) will vow this week to support their economies as they emerge from the pandemic and reach an "ambitious" deal on a minimum global corporate tax in July, a draft communique showed.

G7 officials, set to meet in London on June 4-5, will also say that once the recovery is well established, they will need to "ensure long-term sustainability of public finances", which is understood to be code for a gradual withdrawal of stimulus.

· OECD raises growth forecasts on vaccine rollouts, U.S. stimulus

The global economic outlook is improving as vaccine rollouts allow businesses to resume operations and as the United States pumps trillions of dollars into the world’s largest economy, the OECD said on Monday, nudging its forecasts higher.

The global economy is set to grow 5.8% this year and 4.4% next year, the Organisation for Economic Cooperation and Development said, raising its estimates from 5.6% and 4.0% respectively in its last forecasts released in March.

· ECB's Visco says main drivers of euro zone inflation are energy, one-off factors

European Central Bank governing council member Ignazio Visco said on Monday that the main factors behind the recent rise in euro zone inflation were energy and one-off factors.

Visco says ECB will counter any unjustified interest rate rises

Economic recovery prospects in the euro zone remain uncertain and the European Central Bank will counter any strong rises in interest rates that are not justified by economic conditions, governing council member Ignazio Visco said on Monday.

Visco, the governor of the Bank of Italy, said in an annual keynote speech in Rome that the 2008-2009 financial crisis had shown the risks of premature withdrawal of monetary stimulus.

In the current situation “uncertainty over the timing and the strength of the recovery require that financial conditions remain supportive for a long time,” he said.

· German inflation pushes further above ECB target in May

Germany’s annual consumer price inflation accelerated in May, advancing further above the European Central Bank’s target of close to but below 2%, the Federal Statistics Office said on Monday.

Consumer prices, harmonised to make them comparable with inflation data from other European Union countries, rose by 2.4% in May, up from 2.1% in April. A Reuters forecast had pointed to a May reading of 2.5%.

· EU to kick off pandemic plan with 10 billion euro bond issue - French minister

The European Union plans to kick off its 750 billion euro pandemic recovery package with an initial 10 billion euro bond issue, France’s junior minister for European affairs, Clement Beaune, said on Monday.

In an interview with French financial daily Les Echos, Beaune also said that more than 100 billion euros would be injected into the European economy from this year.

· Russia tells U.S. to expect ‘uncomfortable’ signals ahead of Putin-Biden summit

Russia said on Monday it would send what it described as “uncomfortable” signals to the United States ahead of a summit between the two countries’ leaders next month and announced it was beefing up its western border militarily.

The comments came a day after U.S. President Joe Biden said he would press Russian President Vladimir Putin to respect human rights when the two leaders meet in Geneva on June 16. Relations between the two powers are at post-Cold War lows.

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In its Financial Stability Review on Thursday, the South African Reserve Bank said the economy was continuing to rebound from a 2020 recession that saw gross domestic product contract by 7%, its steepest decline for over a century.

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