WASHINGTON (dpa-AFX) - Gold prices traded lower on Thursday as the dollar strengthened on eased market tensions.
Spot gold dropped half a percent to $3,329.59 per ounce in European trade while U.S. gold futures for August delivery were down 0.6 percent at $3,337.70.
The dollar was on the back foot as U.S. Treasury yields steadied after falling on Wednesday.
Fed independence worries eased after U.S. President Donald Trump denied that he plans to fire Federal Reserve Chairman Jerome Powell.
'We're not planning on doing it,' he said Wednesday at the White House. 'I don't rule out anything,' he added, 'but I think it's highly unlikely, unless he has to leave for fraud.'
Meanwhile, traders pared rate cut bets after Federal Reserve Bank of New York President John Williams vigorously defended the Fed's tight monetary policy approach.
In a speech given before a gathering of the New York Association for Business Economics on Wednesday, Williams said that monetary policy is in the right place to allow central bankers to monitor the economy before taking their next steps.
On the geopolitical front, traders keep a close eye on escalating violence in southern Syria, where Israeli airstrikes targeted Syrian government forces for a second day amid clashes between Druze militias and government-aligned Bedouin fighters in Sweida.
Trading later in the day may by impacted by reaction to the release of U.S. weekly jobless claims report, the latest reading on June's retail sales and last month's export and import price indexes.
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