GOLD - JAKARTA. Gold prices retreated nearly 1% on Thursday, as the dollar strengthened while investors cautiously awaited crucial U.S. economic readings this week for more clarity on monetary policy.
Spot gold was down 0.8% at $1,892.71 per ounce, as of 0754 GMT. Prices hit their highest since Jan. 8 at $1,916.40 on Tuesday.
U.S. gold futures eased 0.6% to $1,898.30.
The U.S. Labor Department is expected to release initial weekly jobless claims data later in the day, followed by non-farm payroll numbers on Friday.
"We need to get a sense from the payrolls report on what is the immediate steer on Fed policy," DailyFX currency strategist Ilya Spivak said.
"Yields have eased back a bit since the start of the week. But the dollar is range-bound, it hasn't been able to build momentum and hasn't fallen off ... that has been reflected in gold."
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The dollar index edged 0.1% higher against its rivals, making gold less appealing for other currency holders.
The U.S. economic recovery accelerated in recent weeks even as a long list of supply chain troubles, hiring difficulties, and rising prices cascaded through the country, Federal Reserve officials said on Wednesday.
Fed officials have said repeatedly they expect price pressures to be temporary and monetary stimulus to stay in place for some time.
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 0.4% to 1,041.75 tonnes on Wednesday.
Analysts at ANZ Research said rising inflation expectations should allow gold prices to rally, likely hitting $2,000 an ounce in the second half of 2021.
"That window is likely to close quickly once the Fed sees inflation becoming entrenched and adjusts monetary policy accordingly," the analysts added.
Elsewhere, silver edged 1.5% lower to $27.78 per ounce, palladium fell 0.3% to $2,849.23, while platinum slipped 0.8% to $1,180.67.
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