Gold prices fell further in Asian markets on Tuesday. The US dollar strengthened, boosting hopes that the US Federal Reserve (Fed) will not cut interest rates in December.
Gold is losing its appeal compared to fixed-income US government bonds, which offer higher yields and longer maturities. Recent comments by Fed officials have further weakened the chances of a December rate cut.
The dollar strengthened further as investors believe that US interest rates will remain high for a long time. Growing concerns about high government spending in advanced economies, especially in Japan, also supported the dollar. As long-term yields on Japanese government bonds rise, the yen weakens and more money flows into the dollar.
