Gold prices hit a more than one-week low on Monday, dragged down by a stronger dollar, while cautious investors awaited the outcome of the U.S. Federal Reserve policy meeting this week with recent spikes in consumer prices seen as a temporary blip.
Spot gold was down 0.6% at $1,864.61 per ounce, as of 0536 GMT, its lowest since June 4.
“The market is starting to anticipate maybe a modest pivot towards discussing taper and it’s sending investors into more of an either profit-taking or reducing gold and also currency positions,” said Stephen Innes, managing partner at SPI Asset Management.
“…the dollar has also gotten a little bit stronger. I think primarily, the inflation pressures are at a state that they may not last, so there’s a little bit of uncertainty how CPI is going to continue playing out.”
The dollar strengthened 0.1% to hover near a one-week high against its rivals, making gold more expensive for holders of other currencies.