Gold prices changed slightly today, Monday, as the strength of the U.S. dollar affected the attractiveness of the yellow metal, while markets await important economic data for more information on the Federal Reserve's plans to raise interest rates in the future. Gold prices settled in spot transactions at $1919.89 per ounce by 05:37 GMT. U.S. gold futures fell 0.1% to $1927.50.
Matt Simpson, Chief Market Analyst at City Index, stated, "In the near term, I believe a retreat towards a range of $1910 to $1913 will occur, and bullish speculators will aim to target a price increase around $1937." He added, "Purchases by speculators may support gold prices."
The stagnation of consumer spending in the U.S. in May indicates that the Fed's interest rate hikes to tame inflation are yielding slow results. The core personal consumption expenditures price index, the Fed's preferred measure to track inflation, rose 4.6% year-on-year after a 4.7% increase in April.
Investors see an 87% chance of a 25 basis points interest rate hike in July, according to CME Group's FedWatch service, expecting rates to remain in the range of 5.25% to 5.5% before declining in 2024.
Bullion fell 2.5% in the second quarter amid expectations that the Fed will continue to raise interest rates. Higher interest rates reduce the attractiveness of investing in gold, which does not yield returns.
The dollar index approached a two-week high recorded on Friday, making gold more expensive for holders of other currencies.
Regarding other precious metals, silver rose 0.5% in spot transactions to $22.87 per ounce, platinum increased 0.1% to $901.84, and palladium rose 0.9% to $1237.97.
