Investing.com - Gold futures struggled for direction in subdued trade on Tuesday, as expectations for a Federal Reserve rate hike later this year weighed.
Gold for December delivery on the Comex division of the New York Mercantile Exchange inched up $1.40, or 0.12%, to trade at $1,134.20 a troy ounce during European morning hours.
A day earlier, gold lost $5.00, or 0.44%, as the U.S. dollar rallied after Federal Reserve officials signaled the central bank is likely to raise interest rates this year.
St. Louis Fed President James Bullard and Atlanta Fed President Dennis Lockhart both made the case for higher U.S. interest rates later this year, weighing on gold.
Investors were looking ahead to a speech by Fed Chair Janet Yellen later in the week for additional clarity on the bank’s decision last week to leave interest rates on hold.
Most market experts believe the Fed will begin raising rates in December after keeping policy steady last week.
Gold fell to a five-and-a-half year low of $1,072.30 on July 24 amid speculation the U.S. central bank will raise interest rates for the first time since 2006 at some point this year.
The timing of a Fed rate hike has been a constant source of debate in the markets in recent months.
Elsewhere in metals trading, copper for December delivery on the Comex division of the New York Mercantile Exchange dropped 3.0 cents, or 1.26%, to trade at $2.359 a pound.
China will release a preliminary reading of the Caixin manufacturing purchasing managers’ index for September on Wednesday amid lingering concerns over a China-led global economic slowdown.
The index is expected to inch up to 47.5 this month from a final reading of 47.3 a month earlier, which was the lowest level since March 2009.
Copper traders consider shifts in the PMI an indicator of China's copper demand, as the industrial metal is widely used by the sector.
Copper prices have been under heavy selling pressure in recent weeks as fears of a China-led global economic slowdown spooked traders and rattled sentiment. Prices of the red metal sank to a six-year low of $2.202 on August 24.
The Asian nation is the world’s largest copper consumer, accounting for almost 40% of world consumption last year.