26.09.202310:03:00UTC+00Gold Hovers Near Two-week Low As Yields Surge

Gold prices touched two-week lows on Tuesday, pressured by a surging dollar and climbing yields on expectations the Federal Reserve may raise interest rates once more this year.

Spot gold slipped 0.2 percent to $1,912.96 per ounce, while U.S. gold futures were down 0.3 percent at $1,931.55.

The dollar index rose for a third straight session and hit a 10-month high against a basket of major rivals - making dollar-denominated gold futures costlier to holders of other currencies.

The 10-year U.S. Treasury yield topped 4.5 percent amid bets that borrowing costs in the U.S. and Europe will remain higher for longer.

Chicago Fed President Austan Goolsbee said on Monday that high inflation remains the "biggest risk" to the economy and the Fed needs to have 100 percent commitment to get inflation back to the 2 percent target.

Separately, Minneapolis Federal Reserve Bank President Neel Kashkari said that rates probably have to go a little bit higher, and then be held higher for longer to cool things off.

Elsewhere, European Central Bank president Christine Lagarde said on Monday that key interest rates may have reached their peak but will stay restrictive for as long as needed to curb inflation.

In economic releases, trading later in the day may be impacted by reaction to the latest U.S. economic data, including reports on new home sales and consumer confidence.

Later in the week, the Commerce Department is due to release its report on personal income and spending in the month of August, which includes readings on inflation said to be preferred by the Fed.