Gold headed for a weekly drop, as traders weighed the interest-rate outlook after the Federal Reserve dialed back rate-cut expectations for next year.

Bullion traded near $2,590 an ounce, and is down about 2% for the week. The Fed reduced rates on Wednesday, but investors were more focused on comments from Chair Jerome Powell, who said that while the bank was "on track to continue to cut," officials would first have to see more progress on inflation. Lower rates are typically a positive for gold, as it doesn't pay interest.

Traders were also weighing US GDP data on Thursday, which showed the economy remains resilient — weakening the need for imminent rate cuts. Meanwhile, consumer spending was revised up to 2.2%, adding to the case for a slower pace of easing. Markets will now be closely watching the last noteworthy piece of data for the year — personal consumption expenditures for November — due Friday.

The precious metal has risen about a quarter this year in a record-breaking run that's been supported by monetary easing in the US, safe-haven demand, and sustained buying by the world's central banks. The rally has stalled since early November, however, as Donald Trump's election victory buoyed the dollar.

Spot gold was little changed at $2,593.29 an ounce at 8:11 a.m. in Singapore, after edging up 0.3% on Thursday. The Bloomberg Dollar Spot Index was 0.1% higher, following a gain of 1.2% over the previous three sessions. Silver, palladium and platinum all fell.

Source : Bloomberg