Gold Falls Amid Rising Oil Prices and Interest Rate Hike Bets

Gold prices dipped slightly on Tuesday as investors awaited key US inflation data. Spot gold fell 0.1% to $4,400.66 per ounce by 1148 GMT, after rising as much as $4,442.70 earlier in the session.

The decline comes as oil prices extended gains to multi-week highs, stoking inflation risks and expectations for Federal Reserve rate hikes. According to Nikos Tzabouras, a senior market analyst at Jefferies-owned Tradu.com, 'Gold trades cautiously today, caught between Fed rate hike bets and dollar softness.'

Higher interest rates tend to diminish the appeal of non-yielding bullion like gold. Traders now price in about a 61% chance of an interest rate hike at the central bank's policy meeting, up from about 50% before the recent data.