(Reuters) – Gold prices tumbled to six-week lows on Thursday, pressured by a stronger dollar on expectations of further U.S. interest rate rises this year and receding political uncertainty in Europe. Spot gold was down 1 percent at $1,225.56 an ounce by 1352 GMT after touching $1,225.20, its lowest since March 17.slid 1.8 percent to $1,226.00. Traders said the sell-off accelerated after New York opened. The dollar strengthened after the U.S. Federal Reserve played down any threats to this year’s planned rate rises, supporting forecasts of another move in June.A rising U.S. makes dollar-denominated commodities more expensive for holders of other currencies, potentially subduing demand for gold. Expectations that centrist Emmanuel Macron would win the French presidential election on Sunday were reinforced after a TV debate with the far-right’s Marine Le Pen. “Since the first round (April 23) of the French election we have seen gold come under pressure,” said ING strategist Warren Patterson. Investors breathed a sigh of relief after Macron won the first round of the election on April 23, seeing his victory as the best of all possible outcomes. Gold fell 1.5 percent on Wednesday for its worst single-day drop since Nov. 23, breaching both its 50-day and 200-day moving averages. The next support comes in around $1,221, the 100-day moving average. “In the very near term we continue to expect that gold will trade moderately lower — our three-month target is $1,200/oz, as a number of bearish catalysts have yet to fully play out,” Goldman Sachs analysts said in a note. Goldman said near-term downside risks for gold included more than the market is expecting and the Fed starting to shrink its balance sheet on the back of possible U.S. tax cuts and solid U.S. and global economic growth. Higher U.S. interest rates are a negative for gold, which earns nothing and costs money to insure and store. The focus is now shifting to Friday’s report for April, which could reinforce perceptions of higher U.S. interest rates in June. lost 1.2 percent to $16.20, having hit a four-month low of $16.17. It has fallen more than 10 percent since reaching a five-month high of $18.65 in mid-April. Platinum gained 0.4 percent to $895.4, after touching $889.10, its lowest since December. Palladium dipped by 1.3 percent to $789.20. It touched $831.50 on Wednesday, its highest since March 2015, on expectations of robust demand from carmakers.
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