Gold Prices Remain Under Pressure as Dollar Strengthens

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© Reuters. Gold still on the downside, traders lock in profits from Monday rally© Reuters. Gold still on the downside, traders lock in profits from Monday rally

Investing.com – Gold prices remained under pressure on Tuesday, weighed by a stronger dollar and as traders locked in profits from the precious metals sharp rally in the previous session.

Comex gold futures were down 0.30% at $1,277.93 a troy ounce by 08:30 a.m. ET (12:30 GMT).

Safe-haven demand was boosted on Monday following a number of corruption arrests that targeted royal family members and ministers in Saudi Arabia.

The weekend purge included a wave of arrests of Saudi Arabian princes, businessmen and government ministers in what has been billed as an anticorruption crackdown but is seen by some as a consolidation of power by Crown Prince Mohammad bin Salman.

But the U.S. dollar remained supported after mostly positive U.S. data released late last week added to expectations for a rate hike by the Federal Reserve.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.42% at 95.02, the highest since October 27.

Gold is sensitive to moves in the dollar. A stronger dollar makes gold more expensive for holders of foreign currency.

Separately, investors were waiting to see how Republicans would reconcile differences over their proposed tax bill that, if enacted, would be the biggest overhaul of the U.S. tax system since the 1980s.

It would also be the first major legislative achievement since Republicans took control of the White House and Congress in January, but doubts remain over the scale of borrowing needed to finance the bill and the timetable for its passage this month.

Market participants were also monitoring U.S. President Donald Trump’s Asian tour. Trump arrived in South Korea on Tuesday amid concerns Washington may resort to military action against its Northern neighbour.

Elsewhere on the Comex, silver futures lost 1.01% to $17.06 a troy ounce.

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