Gold Falls as Stronger Dollar and Inflation Fears Weigh on Prices

Gold prices retreated as the US dollar strengthened following the Federal Reserve's decision to keep interest rates unchanged. The Fed's dovish stance, while not surprising, has bolstered expectations for a rate hike before year-end.

The escalating conflict between the US and Iran, particularly around key maritime routes, is driving up oil prices and fueling inflation fears. This has led to a sharp rise in crude prices, which is pressuring gold via a stronger dollar and higher rate expectations.

Market attention now turns to upcoming data releases, including the Advance Q2 GDP report and the Personal Consumption Expenditures (PCE) Price Index. Investors will scrutinize these data points for guidance on the Fed's next moves, with any surprise on growth or inflation likely to influence the dollar and gold prices.