Investing.com - Gold futures declined in European trade on Wednesday, hitting a one-week low as investors digested hawkish comments from Federal Reserve officials on the timing of the next U.S. rate hike.
Philadelphia Fed President Patrick Harker said late on Tuesday that the central bank should consider another interest rate hike as early as next month if the U.S. economy continues to improve, and said he would prefer at least three hikes before year-end.
Chicago Fed President Charles Evans said he expects two more rate increases this year, unless economic data comes in a lot stronger than expected or inflation picks up faster than anticipated.
The hawkish comments follow similar remarks made by San Francisco Fed President John Williams and Atlanta Fed President Dennis Lockhart earlier this week.
The market will be paying attention to a speech by St. Louis Fed President James Bullard later in the day to further judge the balance of opinion among policymakers on the prospect of further rate hikes.
Gold for April delivery on the Comex division of the New York Mercantile Exchange sank $15.70, or 1.26%, to trade at $1,232.90 a troy ounce by 07:45GMT, or 3:45AM ET, after hitting a session low of $1,231.70, the weakest since March 16.
A day earlier, gold inched up $4.40, or 0.35%, as a series of deadly explosions in Brussels sparked a wave of risk aversion, boosting appetite for safe-haven assets.
Prices of the yellow metal are up nearly 16% so far this year as investors seek safe havens in the face of mounting instability in other financial markets and as fears over a China-led global economic slowdown make it tougher for the Fed to raise rates.
The U.S. central bank surprised markets last week by cutting its rate hike projections more than expected, down from four to two in 2016, citing the potential impact from weaker global growth and financial market turmoil on the U.S. economy.
Also on the Comex, silver futures for May delivery slumped 26.5 cents, or 1.67%, to trade at $15.62 a troy ounce during morning hours in London, while copper futures shed 1.5 cents, or 0.68%, to $2.274 a pound.