Yahoo Finance Gold Prices at 1-Week Lows as Dollar Remains Supported
Investing.com - Gold prices fell to one-week lows on Wednesday, as strength in the U.S. dollar continued to weigh, although caution ahead of the minutes of the Federal Reserve's latest meeting and uncertainty surrounding a big U.S. debt auction this week was expected to limit the greenback's gains.
Comex gold futures were down 0.09% at $1,333.0 a troy ounce by 02:00 a.m. ET (06:00 GMT), the lowest since February 14.
The greenback remained supported against other major currencies despite sustained U.S. deficit worries. The U.S. deficit is projected projected to climb near $1 trillion in 2019 following the recent announcement of infrastructure spending and large corporate tax cuts.
The dollar has been pressured lower recently by expectations for a faster pace of monetary tightening outside the U.S., which would lessen the divergence between the Fed and other central banks.
Market participants were looking ahead to the minutes of the Fed's latest policy meeting, due on Wednesday, for potential indications on the pace of future rate hikes.
Gold is sensitive to moves in both U.S. rates and the dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was steady at 89.67, the highest since February 14.
Investors were also expected to be cautious as the U.S. government was set to launch a series of auctions for $258 billion worth of debt this week.
Elsewhere on the Comex, silver futures lost 0.32% to $16.39 a troy ounce.
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