Dollar Rebound Weighs on Gold Prices Ahead of First Monthly Gain Since February

Gold prices fell by over 1% on Friday as the US dollar regained its footing, but the precious metal is still on track to post its first monthly gain since February. The price of spot gold slipped to $4,062.05 per ounce at 0857 GMT.

The decline in gold prices comes after the Federal Reserve left interest rates unchanged at its policy meeting this week. However, traders are now pricing in a lower chance of a rate hike in September, with only a 63% chance, down from over 80% a week ago.

A stronger dollar makes bullion more expensive for holders of other currencies. The dollar index has staged a modest recovery back above the key 100 level following its sharp post-FOMC sell-off.