Investing.com - Gold prices were trading at three-week lows on Thursday, as the U.S. dollar remained broadly supported by this week's comments by Federal Reserve Chair Jerome Powell.
Comex gold futures were down 0.26% at $1,314.6 a troy ounce by 02:00 a.m. ET (06:00 GMT), the lowest level since February 8.
The greenback remained broadly supported after Fed Chair Jerome Powell reiterated on Tuesday that the U.S. central bank would likely move forward with gradual increases in interest rates.
“The economic outlook remains strong,” he said. “Further gradual increases in the federal funds rate will best promote attainment of both of our objectives.”
Powell was speaking at his first semi-annual monetary policy testimony to the House Financial Services Committee since taking over the helm of Fed earlier this month.
Market participants were looking ahead to the second part of Powell's testimony before the Senate Banking Committee due later Thursday.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was little changed at a six-week high of 90.59.
Gold is sensitive to moves in both U.S. rates and the dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.
Markets shrugged off official data released on Wednesday showing that the U.S. economy grew at a slower rate than initially expected in the fourth quarter.
Elsewhere on the Comex, silver futures dropped 0.45% to $16.25 a troy ounce.