Gold prices dip on firmer U.S. dollar

Gold edged lower on Monday as the dollar rose after bullion ​notched a more than ​2% gain in the previous session, as cooler-than-expected U.S. ​inflation data lifted expectations for interest rate cuts by the Federal Reserve.

FUNDAMENTALS

Spot gold fell 0.4% to $5,020.10 per ounce by 0111 GMT after gaining 2.5% in the previous session.

‌U.S. gold ⁠futures for ⁠April delivery lost 0.1% to $5,039.50 per ounce.

The U.S. dollar index <.DXY rose ​on Monday, making greenback-priced bullion more expensive for holders of other currencies.

The U.S. Consumer ​Price Index rose 0.2% in January, below economists’ expectations of a 0.3% increase, following an unrevised 0.3% gain in December, the Labor Department said ​on Friday. Lower inflation usually increases the chances ⁠for interest rate ‌cuts.

Market participants currently anticipate a total of ​75 basis points ​in rate cuts this year, with the first ⁠expected in July, according to data compiled by LSEG.Non-yielding ​bullion tends to do well in low-interest-rate environments. Meanwhile, ​the U.S. Federal Reserve is expected to name Randall Guynn as its new director of supervision and regulation, said two people familiar with the matter, putting a Wall Street veteran with deep banking ties in a powerful position policing the industry. Elsewhere, the U.S. military is ‌preparing for the possibility of sustained, weeks-long operations against Iran if President Donald Trump orders an attack, two U.S. officials ​told Reuters, in what ​could become a ⁠far more serious conflict than previously seen between the countries. While, Israeli Prime Minister Benjamin Netanyahu said on Sunday he told U.S. President Donald Trump ​last week that any U.S. deal with Iran must include the dismantling of Iran’s nuclear infrastructure, not just stopping the enrichment process.

Spot silver was down 0.6% at $76.92 per ounce, after a 3% rise on Friday.

Spot platinum shed 0.4% to $2,054.35 per ounce, while palladium rose 0.4% to $1,692.23.