Gold retreats from record high as dollar strengthens

Gold prices fall after settling at a fresh record in the previous session.

Gold prices fell on Wednesday after settling at a fresh record in the previous session, as a stronger dollar weighed on the market ahead of key US economic data this week.

December gold futures dropped 1.24%, or $47.6, to $3,768.1 an ounce.

The dollar index, which tracks the greenback against six major currencies, rose 0.64% to 97 by 9:55 p.m. Mecca time.

Analysts said markets are still reacting to Federal Reserve Chair Jerome Powell’s comments that the central bank is seeking to balance risks between high inflation and a slowing labor market, without providing fresh signals on the interest rate outlook, according to Reuters.

Markets continue to price in two rate cuts before year-end, one in October with a 92% probability and another in December with a 75% chance, according to CME FedWatch.

Investors are also awaiting US jobless claims data due Thursday and the core personal consumption expenditures (PCE) price index, the Fed’s preferred inflation gauge, on Friday for further policy clues.