Despite recovering from the day's lows, Gold futures settled lower on Wednesday as the dollar stayed firm amid bets the Federal Reserve will raise interest rates in May.
After some Fed officials said interest rates need to stay higher in order to fight inflation, there are now concerns the ECB and the Bank of England are also likely to raise interest rates again.
Data from U.K. showed inflation remains in double digits in March at 10.1%, dropping from 10.4% a month earlier. However, the reading for March is much higher than the expected level of 9.8%. Core inflation was steady at 6.2% versus expectations of a fall to 6%.
The dollar index, which rose to 102.23 in the European session, dropped to around 101.75 subsequently, but recovered to 101.94 as the session progressed, recording a gain of about 0.2%.
Gold futures for June ended lower by $12.40 or about 0.6% at $2,007.30 an ounce, recovering from a low of $1,980.90 an ounce.
Silver futures for May ended up $0.108 at $25.371 an ounce, while Copper futures for May settled at $4.0770 per pound, down $0.0145 from the previous close.
Investors await the release of the Federal Reserve's Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts.
