Gold prices fell today, Monday, for the second session in a row, as investors focused on the meetings of the Federal Reserve (the US Central Bank) to clarify its strategies to raise interest rates, which may highlight any progress in taming inflation.
The spot gold price fell 0.1 percent to $1980.89 an ounce by 0613 GMT. US gold futures settled at $1990.20.
Higher interest rates increase the opportunity cost of holding non-yielding gold bars.
The dollar rose 0.1 percent, making gold more expensive for buyers who hold other currencies.
Some rise in US Treasury yields after preliminary PMI data on Friday keeps downward pressure on gold prices, said Yip Jun Rong, market analyst at IG.
Gold prices fell more than 1 percent on Friday after the release of surveys showing that business activity in the United States and the euro zone picked up pace in April.
CME VideoWatch shows that markets are betting 88.6 percent that the Federal Reserve will raise interest rates by 25 basis points at its scheduled meeting on May 2-3.
Moreover, the European Central Bank is expected to raise interest rates by a quarter of a percentage point on May 4th with the possibility of a half-point hike. The Bank of England is expected to raise interest rates to 4.5 percent on May 11.
As for other precious metals, spot silver fell 0.3 percent to $24.95 an ounce. Platinum fell 2.1% to $1,100.45, and palladium fell 1.1% to $1,583.94.
