Gold falls as traders seek to secure profits ahead of US economic data

Gold fell on Wednesday, continuing the decline from a level close to a nine-month peak, which it reached in the previous session, as some investors sought to speculate in a way that guarantees them profit. The dollar stabilized ahead of the release of US economic data that may determine the Federal Reserve’s path in monetary tightening.

The spot gold price fell 0.6 percent to $1,926.79 an ounce by 0611 GMT, after hitting its highest level since late April 2022 on Tuesday. US gold futures fell 0.4 percent to $1,928.40.

Meanwhile, the dollar index stabilized. The strength of the US currency makes the gold priced in it less attractive to buyers than holders of other currencies.

The market’s focus is now on US fourth-quarter gross domestic product data due on Thursday, which could set the pace for rate hikes during the Fed’s January 31-February 1 policy meeting.

Most investors expect the bank to raise interest rates by 25 basis points at the policy meeting next week, after slowing its hawkish pace to 50 basis points last month following four consecutive increases of 75 basis points each.

With lower interest rates meaning lower returns on assets such as government bonds, investors may prefer non-yielding gold as a safe haven from interest volatility.

In terms of other precious metals, silver fell 0.6 percent to $23.53 an ounce, and platinum fell 0.3 percent to $1,054.25. Palladium fell 0.8% to $1,728.43.