Spot gold fell 0.3 per cent to $1,781.50 per ounce by 1429 GMT, after hitting its highest since Aug. 6 at $1,795.25 on Tuesday. US gold futures edged 0.1 per cent lower to $1,786.40.
“Concerns about the Delta variants spreading across the globe is obviously a little bit of a driver for gold. People are also expecting more from the Fed on policy tightening, so that’s been the main driver since morning,” said Michael Matousek, head trader at US Global Investors.
The dollar index held close to a 4-1/2 month high scaled on July 21, limiting the appetite for gold for those holding other currencies, while concerns over rising coronavirus cases dented risk appetite.
“Gold prices have recovered sharply on increased haven flows of late and the drop in bond yields, but with the US dollar rising, the upside for the precious metal has been capped,” Fawad Razaqzada, market analyst with ThinkMarkets said in a note.
Investors will scan the Fed minutes due at 1800 GMT for clarity on when the bank might start winding down economic support, after Minneapolis Fed President Neel Kashkari said it could be “reasonable” to start tapering later this year.
“Ultimately the focus is on the Jackson Hole symposium and the next non-farm payroll numbers, which will be very crucial for the market,” said Jigar Trivedi, commodities analyst at Mumbai-based broker Anand Rathi Shares.
Elsewhere, silver fell 1.2 per cent to $23.35 per ounce,
was down 1 per cent to $986.99, and palladium shed 2.6 per cent to $2,425.35.
The slide in “these two highly industrial precious” could be attributed to weakness in some base metals, Commerzbank said in a note.
