Gold prices were dragged lower by a firm U.S. dollar on Tuesday as investors braced for a week of key economic data that could shape the U.S. Federal Reserve’s stance on future interest rates to quell sticky inflation.
Spot gold eased 0.4% to $1,955.68 per ounce by 0723 GMT, while U.S. gold futures dropped 0.8% to $1,955.20 per ounce.
Gold prices ended July 2.3% higher, the biggest monthly rise in four months on expectations that an end to the rate-hiking cycle by global central banks was nearing. Lower rates boost demand for zero-yield bullion.
“The rally is running into technical resistance and recent comments by Jerome Powell are a reminder that the market may have taken a few soft U.S. data points and run with them,” said Nicholas Frappell, global head of institutional markets at ABC Refinery. [TECH/C]
Chicago Federal Reserve President Austan Goolsbee on Monday said the central bank was “walking the line pretty well” on bringing inflation down without causing a recession and will watch the data to judge if more monetary tightening may be appropriate in September.
