Khaberni - Gold prices declined on Monday with the rise of the dollar after the precious metal recorded gains of over two percent in the previous session; due to lower-than-expected U.S. inflation data leading to increased expectations of interest rate cuts by the Federal Reserve (the U.S. central bank).
The price of spot gold fell 0.4 percent to $5020.10 an ounce after rising 2.5 percent in the previous session.
The dollar index rose on Monday, which makes gold priced in the U.S. currency more expensive for holders of other currencies.
The U.S. Department of Labor said on Friday that the U.S. Consumer Price Index rose 0.2 percent in January, which is below economists' expectations of a 0.3 percent increase, after an unadjusted rise of 0.3 percent in December. Typically, lower inflation increases the chances of interest rate cuts.
According to data collected by the London Stock Exchange Group, market participants currently expect a total interest rate cut of 75 basis points this year, with the first cut expected in July.
Gold, which yields no return, tends to rise in a low interest rate environment.
In terms of other precious metals, the price of spot silver dropped 0.6 percent to $76.92 an ounce after climbing three percent on Friday.
Platinum fell 0.4 percent to $2054.35 an ounce. Palladium rose 0.4 percent to $1692.23 an ounce.
