Gold Prices Remain Lower on Stronger U.S. Dollar

Investing.com – Gold prices remained lower on Tuesday, as the recent approval of a major U.S. tax reform bill continued to lend broad support to the greenback.

Comex was down $2.70 or about 0.21% at $1,275.10 a troy ounce by 08:40 a.m. ET (12:40 GMT).

The greenback strengthened after the U.S. Senate over the weekend amid expectations that tax cuts for corporations will stimulate the U.S. economy.

Some investors also believe the boost to the economy will prompt the Federal Reserve to raise interest rates at a faster pace.

Republicans are aiming to send a final tax bill to the White House before Christmas, with the House and Senate working to reconcile separate versions of the plan.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.18% at 93.22.

Gold is sensitive to moves in both U.S. rates and the dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.

Traders seemed to ignore data on Tuesday showing that the U.S. trade deficit in October.

Elsewhere on the Comex, were up 0.72% at $16.26 a troy ounce.

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