Gold prices edged lower on Tuesday as investors awaited key U.S. economic data to determine the Federal Reserve’s next move on interest rates. Spot gold dipped 0.2% to $2,494.56 per ounce, after reaching a record high of $2,531.60 earlier in August. The dollar’s strength, lingering near a two-week high, made gold less attractive for holders of other currencies. Market focus is on upcoming U.S. reports, including non-farm payrolls, ISM surveys, and job openings, with traders currently seeing a 31% chance of a 50-basis-point rate cut by the Fed in September.

Analysts suggest that gold prices could rise as high as $2,640 this year if U.S. economic data points to a weaker economy, prompting a larger rate cut. Gold remains a favored hedge against geopolitical and financial risks, bolstered by anticipated Fed rate cuts and continued central bank purchases from emerging markets. However, technical analysis indicates that spot gold could test support at $2,473, with a potential drop to $2,434 if that level is breached.