Gold slipped on Tuesday amid as the dollar headed for its best month since February ahead of central bank meetings, U.S. payrolls data and the announcement of the next Federal Reserve chair.
The greenback has been boosted by talk that the next chair of the U.S. Federal Reserve could take a more hawkish direction, as well as hopes that Trump could push through tax reform plans. [FRX/]
This was enough to push gold into the red as a stronger greenback makes greenback-denominated bullion more expensive for holders of other currencies.
Spot gold slipped 0.3 percent to $1,271.91 per ounce at 1320 GMT. It has shed half a percent far in October, in what could be its second straight monthly decline.
U.S. gold futures for December delivery dipped 0.3 percent to $1,273.40.
The U.S. Federal Reserve will begin a two-day policy meeting later this session, and U.S. President Donald Trump is likely to pick Fed Governor Jerome Powell as the next head of the U.S. central bank on Thursday.
Powell is seen as more dovish than other contenders for the post like Stanford University economist John Taylor.
"With Powell being a dove it kind of keeps the status quo, so we still see the dollar going higher from here, but in a gradual fashion. That`s likely to be a source of modest downward pressure for gold," said Martin Arnold, commodity strategist at ETF Securities.
Ongoing political unrest in Catalonia was also in focus for gold, seen as a safe haven asset, along with U.S. payrolls data on Friday and a Bank of England policy meeting on Thursday.
"The market is catching its breath for what will be a very data-heavy second half of the week," said Jeffrey Halley, a senior market analyst with OANDA.
"Gold itself appears to have lost any risk-aversion premium for now and is thus completely at the mercy of the nuances of the U.S. bond and stock market, and by default the U.S. dollar," he added.
Federal investigators probing Russian interference in the 2016 U.S. election charged Trump`s former campaign manager, Paul Manafort, and another aide, Rick Gates, with money laundering on Monday.
The news has pressured the dollar, but global stock markets continued their ascent on Tuesday to near a whisker of their all-time highs, indicating investors continue to favour assets perceived as risky versus safe-haven gold.
Among other precious metals, silver edged down 0.4 percent to $16.75 an ounce. Platinum gained 0.3 percent to $919 an ounce, while palladium climbed 1.4 percent to $978 an ounce.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)