Gold prices were seen trading lower on Tuesday, falling to a four-year low on forecasts that the US dollar will strengthened on the monetary policy.
The yellow metal is expected to have its first back-to-back retreat since 2000, according to analysts.
Gold for immediate delivery gained 0.2% to $1,167.39 an ounce, according to Bloomberg generic pricing. The yellow metal fell to $1,161.35 on Friday, the lowest since July 2010. Gold for December delivery declined 0.3% to $1,166.70 on the Comex in New York.
Silver futures for immediate delivery dropped 0.7% to $16.0452 an ounce in London, falling for the fifth consecutive day, marking the longest run of losses since November 2013.
“Gold sits near its lowest level since 2010 on expectations the US Fed is moving towards its first rate rise in 8 years while peers hold rates low and add stimulus (ECB, BoJ),” Michael van Dulken from Accendo Markets commented in a morning note.
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The US dollar index, which measures the strength of the greenback against a basket of major currencies, fell 0.16% to 87.1680.
Last week, the Bank of Japan announced an unexpected increase the quantity of bond purchases under the central bank’s quantitative and qualitative easing program.
“The strong USD is denting bullion demand, while soft global inflation is negating any need for a stimulus-fuelled hyperinflation hedge and the strength in equities is reducing the need for a safe-haven,” van Dulken added.
The US Federal Reserve is expected to raise interest rates after the recent upbeat US economic reports released.
A report from the US Labour Department due this week is expected to show that non-farm payrolls increased 234,000 last month and the unemployment rate at 5.9%.
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