Washington: Gold prices dropped in Asian trading on Tuesday as a stronger United States dollar and low trading activity during regional holidays pushed the precious metal to a one week low.
Spot gold fell about one to two percent before recovering slightly. Analysts said the stronger dollar made gold more expensive for buyers using other currencies, reducing demand in the short term.
Trading volumes remained thin as several major Asian markets including China, Hong Kong, Singapore, Taiwan and South Korea were closed for Lunar New Year holidays. United States markets were also shut for Presidents Day, further reducing liquidity and amplifying price swings.
Other precious metals also declined. Silver dropped notably, while platinum and palladium weakened amid softer demand sentiment.
The dollar remained firm as investors awaited key economic signals from the United States, including the release of Federal Reserve meeting minutes and updated economic growth data. Market participants are looking for clues about the timing of potential interest rate cuts, with many expecting easing later in 2026. Lower interest rates typically support gold because it does not pay interest.
Investors are also watching global developments such as United States Iran nuclear discussions and efforts to end the Russia Ukraine war, as geopolitical tensions can influence demand for safe haven assets like gold.
Despite the latest decline, gold has remained near historic highs after a strong rally in recent months. Continued central bank buying and global uncertainty are expected to support prices over the longer term, even as short term movements remain sensitive to currency strength and monetary policy signals.