Spot gold fell 0.4% to $1,767.38 an ounce in late trading, while US gold futures fell 0.6% to $1,677.80.
Fed Chairman Jerome Powell said: federal A reduction in bond purchases may occur by mid-2022. A statement from the central bank also indicated that this was followed by faster-than-expected increases in interest rates.
Gold is considered a hedge against rising inflation, but the Federal Reserve’s raising of interest rates may reduce the attractiveness of gold because it increases the opportunity cost of holding the precious metal, which does not generate returns.
Following Powell’s comments, the dollar index rose against its rivals, making gold more expensive for holders of other currencies.
Among other precious metals, palladium jumped 5.9 percent to $ 2017.94 an ounce, marking the best one-day performance since May 2020, while platinum rose 4.4 percent to $ 995.27.
Silver rose 0.9 percent to $22.67 an ounce.