Traders have boosted bets that U.S. policy makers will raise interest rates in the next few months, spurred by comments from Fed officials, minutes of the last policy meeting and quickening inflation.
At 19:45 GMT, Gold prices declined $1.48 or 0.12 percent to $1,253.27 per Ounce. While, The US Dollar index trades at levels 95.43 compared to opening 95.29. A strong dollar makes commodities priced in the currency less attractive as a store of value.
Gold rallied to a 15-month high earlier this month on expectations that the Fed would keep rates lower for longer amid risks to the global economy, adding to the appeal of owning non-interest-bearing assets.
As the likelihood of a rate move increased, the dollar strengthened, cutting demand for gold as an alternative asset. The existing-home sales in the United States rose better-than-expected in April, marking the second straight month of increase.
U.S. Federal Reserve officials, suggested a possibility of an interest rate hike as early as June. New York Fed President William Dudley said on Thursday the U.S. economy was strong enough to warrant a rate hike in June or July.
The odds of a rate rise by June or July are now at 28 percent and 47 percent, compared with 4 percent and 17 percent a week ago, Fed funds futures data show.
Minutes of the Fed’s April meeting showed officials discussed raising rates as early as next month. Richmond Fed President Jeffrey Lacker said there was a very strong case for a raise next month.
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