Investing.com - Gold dipped on Tuesday, but remained supported above one-month lows as investors looked ahead to a speech from Federal Reserve Chair Janet Yellen, amid uncertainty over the timing of the next U.S. interest rate hike.
U.S. gold futures for June delivery edged down 0.11% to $1,220.7 an ounce.
On Monday gold fell to a one-month trough of $1,207.83 before recovering to close higher at $1,221.46.
Investors pushed back expectations for a near-term U.S. interest rate hike on Monday as soft data on consumer spending and inflation prompted the Atlanta Fed to lower its first quarter growth estimate to 0.6% from 1.4%.
Personal spending edged up 0.1% in February the Commerce Department said, in line with economists’ expectations, but January’s spending was revised down sharply.
Meanwhile, inflation as measured by the PCE index, the Fed’s preferred inflation measure, dipped 0.1% last month and was up just 1% from a year earlier.
The data indicated that the Fed may raise interest rates only gradually this year, despite the tightening labor market.
An increase in interest rates would boost the greenback by making it more attractive to yield-seeking investors, while weighing on gold by making it more expensive for holders of other currencies.
Gold has gained around 15% so far this year, boosted by increased safe haven demand amid concerns about global economic growth in the early part of the year.
But the precious metal has weakened in recent weeks amid expectations the Fed could act soon to raise interest rates.
Elsewhere in metals trading, U.S. silver futures for May delivery were down 0.46% to $15.12 an ounce. Copper for May delivery dropped 1.2% to $2.219 a pound.