Gold prices held steady on Tuesday as the dollar eased, while investors looked forward to key US inflation data that could offer clues on how soon the Federal Reserve can cut interest rates.

Spot gold was flat at $2,350.85 per ounce, as of 0350 GMT, after rising about 1% in the previous session.

US gold futures rose 0.8% to $2,352.00.

“A very strong dollar picture supported by a change in the US monetary policy stance where the Fed starts looking for evidence to kick start interest rate hikes instead of easing could be a major risk as we could see a further corrective move in spot gold,” said Kelvin Wong, a senior market analyst for Asia Pacific at OANDA.

However, in the short term, spot gold is still more skewed towards the positive side rather than the negative side and $2,310 is a key short-term support for this week, Wong added.

The core personal consumption expenditures price index (PCE), the Fed’s preferred inflation measure, is due on Friday.

Fed meeting minutes released last week showed that the policy response, for now, would involve maintaining the benchmark policy rate at its current level but also reflected discussions of possible further hikes.

Traders’ bets indicated rising scepticism that the US central bank will lower rates more than once in 2024, currently pricing in about a 62% chance of a rate cut by November according to the CME FedWatch Tool.

Bullion is known as an inflation hedge, but higher rates increase the opportunity cost of holding non-yielding gold.

Gold loses momentum on ebbing rate cut speculation

Vietnam’s central bank will stop auctioning gold in the domestic market and launch a new measure to stabilise domestic prices, it said on Monday.

Spot silver rose 0.2% to $31.73, platinum was up 0.4% to $1,058.50 and palladium gained 0.2% to $991.18.