(Reuters) - Gold prices reversed course to edge up on Monday as the dollar pared gains, while investors looked ahead to more U.S. economic data amid expectations of a slower pace of interest rate hikes.
Spot gold fell 0.2% to $1,922.45 per ounce by 12:02 p.m. ET (1702 GMT). It climbed to its highest since April 2022 on Friday.
U.S. gold futures settled little changed at $1,928.6.
“Bond yields ticked up slightly and the dollar has been going up here this morning - that’s just putting some pressure here on gold,” said Bob Haberkorn, senior market strategist at RJO Futures.
“A lot of people will start hopping in when we see some support around $1,950 to see the inevitable move towards $2,000.”
The dollar index was steady at 102.05, while gains in bullion were limited by benchmark yields being near session-highs. [USD/][US/]
Investors will be scanning the U.S. fourth-quarter GDP report on Thursday before the Federal Reserve policy meeting on Jan. 31-Feb. 1.
Traders are pricing in a 98% chance that the central bank will raise rates by 25 basis points (bps) next month, after slowing its pace to 50 bps last month, following four straight 75-bp hikes.
Zero-yield bullion tends to do well in a lower interest rate environment.
Meanwhile, India is expected to slash the import duty on gold, which could lift retail sales by making the metal cheaper ahead of peak demand season. [GOL/AS]
Elsewhere, spot silver fell 2.1% to $23.45, platinum gained 0.4% to $1,047.42, while palladium was down 0.8% to $1,713.25.
Analysts at Goldman Sachs said in a note that supply disruptions have partially reversed for both palladium and platinum, leading to a small surplus, but that surplus could “easily disappear if the expected recovery in South African mine production fails to materialise”.
Reporting by Seher Dareen in Bengaluru; Editing by Jane Merriman and Devika Syamnath
Our Standards: The Thomson Reuters Trust Principles.