Gold slides 1% on strong US housing data, firmer dollar

Gold prices decreased by 1% due to robust U.S. housing starts data and a stronger dollar. The bullion market was weak in anticipation of Federal Reserve Chair Jerome Powell’s remarks on interest rate strategy. The rising dollar makes gold less appealing to holders of other currencies. U.S. homebuilding peaked further in May, pressuring gold prices further. Commerzbank analysts have lowered gold price estimates for the Q2 2023 to $2,000/ounce due to the possibility of another rate hike by the Fed in July and no rate cuts until next year’s Q2 as higher interest rates increase the opportunity cost of holding bullion.