Gold prices fell during Thursday’s trading, with economic data expected to monitor inflationary pressures, in addition to the strength of the US dollar near its highest level in 11 months.
This came as investors received various signals from Federal Reserve officials regarding an increase in the US interest rate.
The price of gold futures contracts, for August delivery, decreased by more than 0.1%, equivalent to $2.50, to record $1,780.90 an ounce, at exactly 09:22 AM GMT.
While the price of spot gold delivery increased by more than 0.1%, or $2.16, to reach $1,780.84 an ounce.
Also, the price of silver contracts, for September delivery, decreased by 0.2%, recording $26.11 an ounce.
The spot price of platinum also decreased, by about 0.6%, recording $1082.08 an ounce, while the spot price of palladium recorded a marginal increase of 0.05%, to reach $2616.92 an ounce.
Meanwhile, the dollar index, which compares the performance of the US paper against a basket of 6 major currencies, settled at 91.786 points, close to an 11-month high.
Precious metal performance
Gold has come under pressure from the strength of the greenback, which is making gold more expensive for holders of currencies other than the dollar.
Investors are focusing on the comments of US monetary policy officials, after the Federal Reserve hinted at its last meeting the possibility of a rate hike next year.
Two Fed officials said Wednesday that a period of high inflation in the US could last longer than expected.
The comments come a day after Federal Reserve Chairman Jerome Powell downplayed concerns about inflation and indicated that interest rates may not be raised too quickly.
However, Federal Reserve Bank of Atlanta President Rafael Bostik sees rates needing to rise in late 2022, given that the inflation rate is well above the Fed’s 2% target.
Gold is often seen as a hedge against inflation, although an interest rate hike by the Fed would increase the opportunity cost of holding gold and reduce its attractiveness.
On the other hand, investors are awaiting today the release of jobless claims data in the United States and the final reading of the performance of the American economy in the first quarter.
Investors focusing on US producer price data due for release on Friday.