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U.S. dollar heads for monthly gain
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Silver set for second straight monthly fall
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Platinum, palladium on track for monthly loss
(Updates prices)
By Ashitha Shivaprasad
Feb 28 (Reuters) - Gold prices slipped to a two-month
low on Tuesday and were on track for their biggest monthly
decline since June 2021, pressured by an elevated dollar and
prospects of more rate hikes from the U.S. Federal Reserve.
Spot gold was down 0.5% at $1,808.07 by 1334 GMT,
having earlier hit its lowest since late December at $1,804.20.
U.S. gold futures slipped 0.6% to $1,814.90.
Prices touched their highest since April 2022 in early
February, but soon reversed course. Bullion has fallen more than
6% so far this month after strong economic data boosted
expectations of more rate hikes by the U.S. central bank.
Gold is having a negative month as the market is expecting
interest rates to remain higher for longer, said Carlo Alberto
De Casa, external analyst at Kinesis Money.
"If inflation continues to rise, then gold might fall to the
$1,730-$1,740 range."
Fed Governor Philip Jefferson said on Monday that he was
under "no illusion" that inflation would return quickly to the
U.S. central bank's target.
Although gold is considered an inflation hedge, rising
interest rates increase the opportunity cost of holding the
non-yielding asset.
Gold is moving closer to a very interesting area of support
between $1,780 and $1,800, but economic data may determine how
firm a support zone it will be, Craig Erlam, senior market
analyst at OANDA, said in a note.
"How it reacts to this level could give a strong indication
of sentiment in the markets at this time."
The dollar index was headed for a monthly rise,
making greenback-priced gold less attractive for other currency
holders. Spot silver fell 0.5% to $20.52 per ounce on the
day and was set for its second straight monthly fall.
Platinum firmed 0.9% to $947.30, and palladium dropped 1.2% to $1,412.80. Both metals were set to post a drop
in prices for the month.
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Gold prices vs U.S. dollar ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
(Reporting by Ashitha Shivaprasad and Kavya Guduru in
Bengaluru; Additional reporting by Bharat Govind Gautam; Editing
by Shounak Dasgupta and Christina Fincher)
