Gold prices moved off lows but remained on track to post a drop this month as an ongoing rally in the dollar kept demand for the precious metal lower than expectations .
Gold futures for June delivery on the Comex division of the New York Mercantile Exchange fell by $6.10 or 0.47%, to $1,317.60 a troy ounce. The precious metal fell to an intraday low of $1,317.50.
The 10-year treasury bond yield remained below 3% despite data showing inflation was nearing the Federal Reserve’s target, raising the prospect of a faster pace of monetary policy tightening.
The Federal Reserve’s preferred inflation measure, the personal consumption expenditures (PCE) price index excluding food and energy, rose 1.9% in the 12 months through March, nearly matching the Fed’s 2% target.
The uptick in inflation comes a day before the Federal Reserve Open Market Committee (FOMC) is slated to begin its two-day policy meeting on Tuesday.
According to investing.com’s fed rate monitor tool, 94% of traders expect the Fed to leave rates unchanged on Wednesday. The prospect of a fourth rate hike in December, however, was just under 50% following a dramatic rise in recent weeks.
Sentiment on gold prices has soured in recent weeks as traders trimmed their bullish bets on the yellow metal to a six-week low amid a lack of supportive factors as geopolitical uncertainty continued to ease.
In other precious metal trade, silver futures fell 0.68% to $16.30 a troy ounce, while platinum futures fell 1.12% to $906.10 an ounce.
Copper fell rose 0.02% to $3.071.