Gold prices extended losses on Wednesday as the US dollar strengthened after hawkish comments from a Federal Reserve official dampened expectations for a March interest rate cut, while traders awaited comments from more Fed speakers this week.
Spot gold was down 0.2 percent at $2,023.49 per ounce, after stooping 1.3 percent in the previous session – its biggest single-day decline since Dec. 4, 2023.
US gold futures also fell 0.2 percent to $2,026.90.
Flow of funds to the US dollar have been a key driver impacting the gold price, said Michael Langford, chief investment officer at Scorpion Minerals Ltd, forecasting bullion to trade around $2,000/Oz in the near term. The dollar index rose 0.1 percent , making bullion more expensive for other currency holders. It shot up to a more than one-month high on Tuesday after Fed Governor Christopher Waller said that the US central bank should not rush to lower interest rates until lower inflation can clearly be sustained
Waller’s comments triggered a broad sell-off, pulling all three major US stock indexes lower, while the benchmark US Treasury yields logged their biggest daily move upwards in more than three months on Tuesday.
