Gold prices ticked higher on Monday as a tepid dollar made bullion less expensive for overseas buyers, although the prospects of further interest rate hikes by the U.S. Federal Reserve next year kept gains in check.
Spot gold was up 0.1% at $1,794.60 per ounce, as of 0226 GMT. U.S. gold futures rose 0.2% at $1,804.00.
The dollar index slipped 0.1%.
Gold prices attempted to recoup losses, considering that despite the hawkish takeaway from the Fed, upside reaction in the dollar and yields still seem more measured, said IG Market strategist Yeap Jun Rong.
Bullion registered its biggest weekly decline since mid-November on Friday after Fed Chair Jerome Powell said the U.S. central bank would deliver more hikes next year, despite growing recession worries.
Fed policymakers may need to lift U.S. borrowing costs above the peak 5.1%, and keep them there perhaps into 2024 to squeeze high inflation out of the economy, three of them signalled on Friday.
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