Gold prices slip as US dollar rises ahead of Powell's speech

Gold bars

Gold prices declined as the US dollar gained ground today, July 2, ahead of an anticipated speech by Federal Reserve Chairman Jerome Powell at the European Central Bank’s (ECB) Central Banking Forum in Portugal later in the day, which may provide clues about the path of US interest rates.

Bullion for August delivery plummeted by 0.18%, or $4.30, to $2,334.6 per ounce at 10:17 am Makkah time, with spot prices also down 0.30%, or $7.03, to $2,324.87 an ounce.

Similarly, silver futures for July delivery fell slightly by 0.1% to $29.59 per ounce, in tandem with a 0.40% slump in platinum spot prices to $977.95 an ounce.

Meanwhile, the US dollar index, which gauges the greenback's strength against a basket of six currencies, advanced 0.12% to 106.03 points.

Citigroup analysts projected increased demand for gold purchases to accommodate almost all mine supplies for a 12-to-18-month period.

However, they pointed to key downsides to their expectations: the weaker-than-expected Chinese demand, lower demand from global central banks, and a delay in the Federal Reserve's return to normal monetary policy.