Investing.com – Gold prices were roughly unchanged on Monday as dollar strength continued to weigh on upside momentum in the precious metal.
Gold futures for December delivery on the Comex division of the New York Mercantile Exchange rose $0.98, or 0.09%, to $1,281.67 a troy ounce.
In what was a quiet day for top-tier economic data, gold prices came under pressure on signs that sentiment on the dollar is turning positive after data showed traders continued to unwind their bearish bets on the greenback.
Speculators pared net bearish bets on the dollar to their lowest level in more than a month, Commodity Futures Trading Commission data showed on Friday.
The precious metal has struggled to pare losses since falling below a key price level of $1300 amid signs of progress on tax reform and growing expectations that the U.S. central bank will hike rates later this year.
“Selling pressure [on gold] is being generated by a firmer U.S. dollar that is appreciating on the back of hopes of a tax reform and the expectation of higher interest rates in the U.S,” said Carsten Fristch, commodities analyst at Commerzbank (DE:CBKG), in a note.
According to investing.com’s fed rate monitor tool nearly 100% of traders expect the Fed to hike interest rates in December.
Gold is sensitive to moves higher in both bond yields and the U.S. dollar – A stronger dollar makes gold more expensive for holders of foreign currency while a rise in U.S. rates, lift the opportunity cost of holding non-yielding assets such as bullion.
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