Gold down as US dollar rises, traders wait more US data

Gold prices fell on Thursday as the dollar rose, although bullion remained near record highs as traders awaited more US economic data that could raise hopes for a mid-year interest rate cut.

According to Reuters, by 0426 GMT, gold in spot transactions fell 0.2% to $2,171.05 per ounce, and US gold futures contracts also fell 0.2% to $2,175.40.

The dollar index increased 0.1%. A rise in the US currency makes gold more expensive for holders of other currencies.

Investors are awaiting US retail sales data, producer price index reports and unemployment claims later on Thursday to assess the state of the US economy and whether this will make the Federal Reserve refrain from cutting interest rates in June.

Kelvin Wong, chief market analyst for the Asia-Pacific region at OANDA, said: “Gold prices witnessed a slight decline after the release of the US CPI data, but it does not change the market’s view much on US monetary policy, and with today’s producer price index data, if the reading comes in… “The fundamental annual basis is close to expectations, so I still think that gold may find support.”

The Federal Reserve will release its latest forecasts at its policy meeting next week. The December meeting expected interest rates to be cut by three-quarters of a percentage point in 2024.

As for other precious metals, platinum fell in spot transactions by 0.3% to $935.50 per ounce. Palladium fell 0.3% to $1,056.24, and the price of silver also fell 0.3% to $24.95 after recording its highest level in more than 4 months earlier in the session.