Gold slips to over one-week low on hawkish Fed, US data

The non-yielding bullion hit a record high of $2,449.89 on Monday and is up 14% so far this year.

Making gold less attractive, cut its losses for the day on U.S. business activity accelerating to the highest level in over two years in May, suggesting that picked up half-way through the second quarter.

Advancing dollar and a weakening U.S. rate cut outlook have catalyzed a round of profit-taking in gold, but the downside will be limited, said Daniel Ghali, commodity strategist at .

While the policy response for now would "involve maintaining" at current levels, latest minutes reflected discussions of possible hikes.

"Investors that care about the Fed outlook actually aren't all that long in gold. They've missed the rally and in turn don't have that much gold to sell. So while we do think the gold prices are staging a correction here, but that will be relatively shallow," Ghali said.

raised its gold to $2,600/oz for 2024-end and recommended to buy on dips at around $2,300/oz or below, citing a series of softer U.S. data for April, an upwardly revised central bank demand for gold and ongoing geopolitical uncertainties.

Meanwhile, imports to , the world's second-biggest gold consumer, could fall by nearly a fifth in 2024 as high prices spur retail consumers to exchange old jewellery for new items, according to an industry body.

Spot silver fell 1% to $30.45. The recent rally in gold and copper prices drove it to $32.5, an 11-year high, earlier this week.

Platinum was down 0.7% at $1,028.15, while palladium lost 2.5% to $974.72.