Gold eased on Wednesday, after sharp overnight gains, as the dollar soared and Asian shares traded near its highest level in six months, thereby denting the allure of the metal.
The precious metal hit a high of $1257.86 an ounce, while currently trading around $1249.00 from the opening at $1249.20.
The dollar index, which tracks the green currency’s movements versus a basket of major currencies, soared for the first time in four sessions to hover around 94.00.
The green currency plunged on Tuesday after U.S. data showing housing starts dropped to 1.09 million in March from 1.19 in February and building permits fell to 1.09 million, the lowest in a year.
Later in the day, the U.S. will release its existing home sales for March, which may show a rise to 5.29 million from a previous of 5.08 million.
The downbeat housing data raised expectations the Federal Reserve would not hike its interest rate any time soon.
Gold climbed 1.5 percent on Tuesday, while silver leaped 4.4 percent, taking advantage of the drop in the dollar.
“Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, slid 7.43 tonnes to 805.03 tonnes on Tuesday, the biggest drop in a month,” according to Reuters.
Asian shares rose to a six-month higher, where Japanese shares extended gains, yet Chinese shares faced some sell off.
Crude oil retreated to trade around $41.64 a barrel after hitting a peak of $42.86 the previous session on protests from oil workers in Kuwait.
