Grapevine

Gold dips on firmer dollar; attention on Fed cues

Gold prices eased on Monday, weighed down by a firmer U.S. dollar, while investors looked out for fresh clues on Federal Reserve interest rate cuts.

Spot gold fell 0.2% to $2,651.99 per ounce by 0252 GMT after rising 1% in the previous session. U.S. gold futures lost 0.3% to $2,669.20.

The dollar index rose 0.1% on Monday, not far from a near two-month high hit last week. A stronger dollar makes bullion less attractive for other currency holders.

"The continued momentum of the U.S. currency on reigned-in rate cutting expectations has created an obstacle for the gold price," said Tim Waterer, chief market analyst at KCM Trade.

Traders see a roughly 89% chance of the Fed cutting rates by 25 basis points at its November meeting, and an 11% chance it will leave rates unchanged.

Data on Friday showed unchanged U.S. producer prices last month.