Gold prices declined in European trading on Wednesday for the first time in four sessions, poised to dip below $2,500 and pulling back from recent record highs due to profit-taking and a stronger dollar.
Investors are now focused on key US inflation data due later this week, which could provide insight into the potential direction of future Fed rate cuts.
Prices:
Gold prices dropped 0.85% today to $2,503 an ounce, after reaching a session high of $2,529.
On Tuesday, prices had increased by 0.3%, nearing a record high of $2,531 an ounce.
The Dollar:
The dollar index rose 0.4% on Wednesday, maintaining its position above the eight-month low of 100.51 against a basket of major currencies, exerting pressure on dollar-denominated gold futures.
The dollar's gains were supported by strong US housing prices and consumer sentiment data.
US Rates:
According to the FedWatch tool, the probability of a 0.5% rate cut by the Fed in September is 38%, while the chance of a 0.25% rate cut is 62%.
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