- Fed needs to move slowly with further rate cuts, Jefferson says
- Focus shifts to US non-farm payrolls data due on Thursday
- Traders see 46% chance of US interest rate cut in December
Nov 18 (Reuters) - Gold prices fell to their lowest levels in more than a week on Tuesday as fading bets on a Federal Reserve interest rate cut next month dented demand ahead of delayed U.S. economic data releases this week.
Spot gold was down 0.3% at $4,033.29 per ounce, as of 0909 GMT, after earlier hitting its lowest since November 10.
U.S. gold futures for December delivery fell 1% to $4,032.60 per ounce.
"Market participants are pricing out U.S. interest rate cuts following more hawkish comments from Fed officials," said UBS analyst Giovanni Staunovo.
"I would expect gold prices to bottom out soon, as I still see the Fed cutting rates several times over the coming quarters, and central banks diversification into gold remains strong."
Markets have trimmed their bets for a rate cut next month to a just over 46% chance, down from 67% last week, the CME FedWatch tool showed. FEDWATCH
The longest U.S. government shutdown, which ended last week, led to a halt of official economic data, leaving policymakers and traders flying blind ahead of next month's Fed policy meeting.
Traders had hoped the resumption of official data would make the case for a December rate cut, but those hopes faded as more Fed officials last week signalled caution.
Fed Vice Chair Philip Jefferson said on Monday that the central bank needed to "proceed slowly" on further rate cuts.
Non-yielding gold tends to do well in a low-interest-rate environment and during times of economic uncertainties.
Meanwhile, markets are awaiting delayed U.S. data releases this week, with minutes from the Fed's last meeting due on Wednesday and September nonfarm payrolls on Thursday.
"We still see a longer-term favourable fundamental backdrop for gold. The U.S. economy continues to cool, U.S. interest rates are set to fall and the U.S. dollar should weaken as a result," said Julius Baer analyst Carsten Menke.
Elsewhere, spot silver was steady at $50.2 per ounce, platinum was up nearly 0.1% at $1,534.29, and palladium held steady at $1,393.57.
Reporting by Noel John in Bengaluru; Editing by Alexander Smith
Source: Reuters