Gold slides below $2,000/oz for first time in two months after US inflation data

Shafaq News/ Gold prices fell below the key $2,000 per ounce level to a two-month low on Tuesday, as a stronger-than-expected U.S. inflation report tempered prospects of an early interest rate cut from the Federal Reserve.

Spot gold was down 1.3% at $1,993.29 an ounce by 01:56 p.m. ET (1856 GMT), its lowest since Dec. 13.

U.S. gold futures settled 1.3% lower to $2007.2.

Data showed U.S. consumer prices increased more than expected in January amid an increase in the costs of shelter and healthcare.

"That was not the report that the market wanted to see," said Tai Wong, a New York-based independent metals analyst.

"Fed doves are looking for shelter today as surprisingly stubborn inflation has dropped the chances of a May rate cut under 50% for the moment," Wong added.

Fed policymakers will probably wait until June before cutting interest rates, traders bet after the U.S. CPI data. Higher interest rates increase the opportunity cost of holding bullion.

Following the inflation data, the dollar jumped 0.7% to a three-month high against its rivals, making gold more expensive for holders of other currencies. The U.S. 10-year Treasury yield also rose.