Gold prices incurred losses in early trading on Wednesday, after touching the highest level in a month and a half in the last session, affected by a slight rise in the dollar, despite investors' expectations that recent US economic readings will convince the Federal Reserve (the US central bank) to stop the cycle of raising interest rates.
The dollar index rose slightly after hitting its lowest level in more than a year on Tuesday, making gold more expensive for buyers holding other currencies.
US retail sales increased less than expected last month, rising 0.2 percent, compared to economists' forecasts of a 0.5 percent rise in a Reuters poll.
Yap John Rong, market strategist at IG, said that while the US central bank is widely expected to raise interest rates by 25 basis points at its meeting on July 26, the bank is expected to maintain its hawkish tone, which could be a challenge. In front of the upward trend of gold.
According to 106 economists polled by Reuters, the expected rate hike on July 26 to the range of 5.25-5.50 percent may be the last time the US central bank raises interest rates in the current monetary tightening cycle.
Lower interest rates reduce the opportunity cost of holding non-yielding gold.
