Gold prices declined sharply on Tuesday after the yield on long term government bonds rose and the dollar strengthened against some major rivals.
The dollar rose on remarks from a few Fed officials that the central bank might tighten monetary policy sooner rather later.
Concerns over the imposition of tougher restrictions in some countries including Australia due to surging coronavirus infections contributed as well to the dollar’s uptick.
In the U.K, coronavirus cases involving the Delta variant are rising, prompting European nations such as Spain and Portugal to impose new restrictions on travelers.
The dollar index, which rose to 92.19, was hovering around 92.05 a few minutes ago, gaining about 0.18%.
Gold futures for August ended down by $17.10 or about 1% at $1,763.60 an ounce, the lowest close since mid April.
Silver futures for September ended down by $0.353 or 1.3% at $25.901 an ounce, while Copper futures for September shed $0.0140 or 1.4% at $4.2645 per pound.
Several Fed policy makers have turned hawkish recently despite a weaker-than-expected U.S. inflation reading last week.
Richmond Fed President Thomas Barkin said on Monday that the central bank has made “substantial further progress” toward its inflation goal so as to begin the withdrawal of stimulus.
Barkin added that he would decide next year whether the U.S. central bank had reached its inflation and employment goals to justify a rate hike.
In economic news, the Conference Board said Tuesday that its Consumer Confidence index for June came in with a reading of 127.3, up from a revised reading of 120.0 in the previous month.
The S&P CoreLogic Case-Shiller 20-city home price index in the US increased by 14.9 percent in April 2021, following a revised 13.4 percent growth in the previous month and beating market expectations of 14.5 percent.
Investors await U.S. jobs report due on Friday to determine the pace of improvement in the labor market.
Other key economic data due this week include pending home sales, ADP private sector payrolls, jobless claims and ISM manufacturing activity.