Gold Prices Slide as Stronger Dollar Weighs on Bullion

Gold futures on Bursa Malaysia Derivatives closed lower on Tuesday due to a stronger US dollar, according to Stephen Innes, global strategist at Quintex Intel. The firm dollar was attributed to hawkish comments from US Federal Reserve officials, particularly Chicago Fed president Austan Goolsbee.

Goolsbee warned that supply shocks and strong spending could keep inflation persistent, making the path back to the Fed's 2.0% inflation target 'not painless'. Markets are still trying to determine the Fed's interest rate path beyond year-end, with foreign exchange traders leaning towards a more hawkish outlook than previously expected.

Despite gold being firmer during the New York session, it sold off steadily throughout the Asian session, mirroring Monday's trading pattern. The unusual selling in Asia was due to markets appearing more optimistic about the upcoming meeting between US President Donald Trump and Chinese President Xi Jinping potentially easing East-West geopolitical tensions.