A strong dollar continued to pressure gold prices amid growing expectations that investors will be forced to abandon their traditional safe haven, as recent economic data suggests the Federal Reserve may change course on monetary policy and adopt a more cautious approach to interest rate cuts, adding pressure on gold prices.
Update prices
Spot gold fell 0.3 percent to $2,627.60 per ounce by 0302 GMT, while U.S. gold futures fell 0.5 percent to $2,627.00.
The dollar index rose 0.1 percent, reducing gold's appeal to holders of other currencies.
As for other precious metals, silver fell by about 1 percent to $29.78 per ounce, platinum fell 0.1 percent to $928.05, while palladium settled at $972.75, according to Reuters.
The market is focused on interest rate cuts by the US Federal Reserve, with the latest core personal consumption expenditures data pointing to slowing inflation, reinforcing expectations that the Fed's policies next year will be less dovish than previously expected, said Kelvin Wong, senior market analyst for Asia-Pacific at OANDA.
According to the CME FedWatch tool, markets are currently pricing in a 64.7 percent chance of a quarter-point rate cut in December.
Trading is expected to be modest as U.S. markets are closed on Thursday for the Thanksgiving holiday.
Wong added that in the short term, especially in the next few days or two weeks, gold may come under further pressure. However, the outlook for gold is still bullish in the long term.
