BENGALURU: Gold prices pulled back after earlier touching a near one-month high on Thursday as the dollar inched up, while cautious comments from a Federal Reserve official dampened investors’ enthusiasm.

Spot gold fell 0.4% to $2,376.37 per ounce as of 1417 GMT, after hitting its highest since April 19 earlier in the session.

Bullion rose over 1% on Wednesday. Meanwhile, US gold futures slipped 0.7% to $2,378.70. The dollar index edged up 0.2% after falling sharply on Wednesday on the back of data showing a slowdown in US inflation, making gold less attractive for other currency holders.

Federal Reserve Bank of New York President John Williams welcomed the arrival of softer consumer inflation data, he told Reuters on Thursday, but said that positive news is not enough to call for the US central bank to cut interest rates sometime soon.

“We’ve seen most comments from Fed officials over the course of yesterday afternoon and this morning continued to hold steady with their rhetoric in regards to needing to keep rates elevated for a bit longer,” said David Meger, director of alternative investments and trading at High Ridge Futures.

“However, we think the underpinning fundamentals of a sideways to higher market are still at play.” US consumer prices increased less than expected in April, potentially encouraging policymakers who were waiting to see renewed progress on inflation before reducing borrowing costs. Lower interest rates boost non-yielding bullion’s appeal.

Market participants are pricing in a roughly 71% chance that the Fed will cut rates in September, according to CME’s FedWatch tool. Meanwhile, spot silver fell 0.9% to $29.44 per ounce, having hit its highest since February 2021 earlier in the session.