BENGALURU: Gold prices were subdued on Tuesday as a slightly firmer dollar countered support from falling Treasury yields while investors await US economic data that could provide further indications on the outlook for US interest rates.

Spot gold was steady at $2,027.22 an ounce at 1205 GMT. US gold futures were also flat at $2,041.30. “The market got a little bit too excited after the FOMC meeting, betting on big rate cuts next year, but several members are not yet ready and still regard that the risk of inflation has not yet been overcome completely,” said Quantitative Commodity Research analyst Peter Fertig.

Federal Reserve Chair Jerome Powell last week sais that the US central bank’s monetary policy tightening is likely to be over, with discussion on cuts to borrowing costs moving “into view”.

While some Fed officials have pushed back against surging market expectations of rate cuts, the remarks have done little to change investor sentiment. Markets are still pricing in about a 70% chance of a rate cut in March, according to the CME FedWatch tool.

“Supporting gold, on the other hand, is that the yields on government bonds are coming down, which is reducing the opportunity costs of holding gold,” Fertig added.

Investors are awaiting a slew of US economic data this week, including the November core personal consumption expenditure (PCE) index report, the Fed’s preferred measure of underlying inflation, on Friday.