• Gold price loses ground on cautious market sentiment ahead of US Inflation data.
• The improved Greenback fades the shine of the bright metal.
• Investors seem to prefer the US Dollar instead of safe-haven Gold during geopolitical tension.

Gold price moves on a downward trajectory that began on January 7, inching lower to near $2,020 per troy ounce during the Asian session on Tuesday. The precious metal is encountering resistance as the US Dollar strengthens for the second consecutive session, supported by subdued US bond yields in anticipation of the release of US inflation data on Tuesday.

The anticipation of inflationary pressures in the United States (US) has led to expectations that the Federal Reserve (Fed) will abstain from reducing interest rates at the March meeting. This outlook is diminishing the appeal of non-yield-bearing assets like Gold. Markets are pricing in only a small 14% probability of a rate cut by the Fed in March. However, the likelihood of a rate cut at the May meeting is estimated to be around 60%.

Dallas Federal Reserve (Fed) Bank President Lorie K. Logan recently stated that there is presently no immediate need to lower interest rates. She acknowledged "significant progress" in curbing inflation but stressed the importance of obtaining additional evidence to ensure the sustainability of this progress.

The price of Gold is facing downward pressure as the US Dollar gains renewed demand amidst escalating geopolitical tensions in the Middle East. Yemen’s Houthi rebels reportedly launched missiles at a ship bound for a port in Iran, resulting in minor damage to the vessel but no injuries to its crew, according to authorities