Gold and the corresponding SPDR Gold Trust (ETF) (NYSEARCA:GLD) were seen stagnating in European trading on Thursday after pulling back earlier in the day in Asia.

Gold futures for December delivery had already touched a session low of $1,355.25 a troy ounce in the early morning trading in Europe. Earlier in the day in Asian trading, prices of the yellow metal pulled back about 0.62% to retreat further from its 28-month high achieved on Wednesday.

Gold lost 0.58% on Wednesday, with the disruption in the trading of the yellow metal coming from bullish U.S. crude oil and private payroll data. Prices of U.S. oil jumped 3.3% to perch above $40 a barrel after it emerged that gasoline inventory declined more than expected.

Bullish U.S. private jobs data hitting the market also tempered the appetite for gold.

Eyes on the Bank of England

Gold was sliding in what appears to be cautious trading as traders eye the policy announcement by the Bank of England later today. It is widely expected that the BOE will announce more easing measures as economic data coming out of the U.K. after the country voted to leave the European Union have tended to be soft.

Economists are predicting that the BOE will trim lending rates to 0.25% from the current 0.50%. That easing move may help avert price deflation in the U.K. according to mainstream economists, even though consumer prices have not fallen substantially in decades, not even during the 2008 financial crisis, so it is hard to understand what is being referred to as deflation.

BOE’s rate hike will follow that of the Reserve Bank of Australia that trimmed lending rates to historic low of 1.5%.

Focus on US data

But gold traders are trying to be cautious even as they anticipate rate cuts by the BOE. U.S. labor numbers are expected out this week and it is already said that the country may have created far more jobs than economists modeled for the month of July. Bullish economic data in the U.S. could provide incentive for the Federal Reserve to raise interest rates quickly. But higher interest rates are dangerous for gold as they diminish the appeal of the yellow metal as a safe-haven investment.