Gold futures fell as the dollar rose due to weakened hopes for interest rate cuts.

Gold futures retreated due to rising U.S. Treasury yields and a stronger dollar. Futures fell 0.7% to $2,662.50 per ounce.

Experts say the market is increasingly focused on the possibility of the Federal Reserve maintaining high rates for a longer period.

The report indicated that this dynamic supports the dollar and yields while dampening the appeal of the non-yielding precious metal.

The prospect of a trade war sparked by the incoming Trump administration could reignite inflation, coupled with strong U.S. economic performance, which has heightened confidence that the central bank will slow the pace of interest rate cuts.

Upcoming U.S. economic data may provide more insights into the possible trajectory of the Federal Reserve.

Strong economic and labor market data could bolster expectations for fewer rate cuts.