Gold rose slightly at the start of the week, rising 0.28% on Monday as investors awaited US Retail Sales data and the Federal Open Market Committee (FOMC) decision.
At 9.30am, gold was at $2,656.01, up 0.11% since it opened in early Asian trading on Tuesday.
The US economic data released by the S&P Global Flash PMI for December came in mixed. Business activity in the manufacturing sector weakened after improving last month and the services sector recorded its highest reading in 2024.
The figures supported the US Dollar Index (DXY) which rose 0.07% to 107.01 points and dragged the yellow metal to around $2,650.
Meanwhile, the Fed will meet for the last time in 2024 on December 17 and 18 in the North American session to set a 25 basis point interest rate cut and market participants will be watching the Summary of Economic Projections (SEP) to see the path of interest rates in 2025.
However, there is growing speculation that the Fed may adopt a gradual stance as the incoming Trump administration envisions inflation-prone fiscal policies.
Gold prices tend to rise in an environment of lower rates and higher geopolitical risks, both of which have subsided recently.
Investors are now awaiting the release of Retail Sales, Industrial Production, the FOMC decision and the core Personal Consumer Expenditures (PCE) Price Index.
