Gold prices fell on Wednesday after strengthening in the previous two sessions as investors adjusted positions in anticipation of U.S. inflation data for April, which could affect the Federal Reserve’s policy.

The spot gold price fell 0.25% to $2,029.06 a troy ounce. Economists expect core consumer prices to rise 5.5% year-over-year in April.

“Right now, gold in dollar terms has good support up to the $1.970 level, while resistance could occur in a range between $2.066-$2.076,” said Daniela Hathorn of capital.com.

“We may see a rebound in stocks today when the U.S. Consumer Price Index comes out if the data shows that inflation continues to decline. But we will likely continue to see support for buying gold as concerns about economic growth maintain the path of least resistance to upside,” added Hawthorne.

Fed Chairman Jerome Powell said that the question of whether to continue raising rates remains open as the economy continues to face high inflation but shows signs of slowing.

Although gold is considered a hedge against inflation, rising interest rates are making the non-interest-bearing precious metal less attractive.

But analysts say gold could make another attempt to hit record highs given ongoing economic concerns, including worries about the U.S. government debt ceiling.

U.S. President Joe Biden and top U.S. lawmakers agreed Tuesday to continue talks and seek a way out of the impasse over raising the size of the national debt, now capped at $31.4 trillion.

If U.S. inflation remains moderately under control, that could lead to a pause in rate hikes, weakening the dollar and supporting gold, said Harish B, of Geojit Financial Services.

Palladium was steady at $1,569.96 an ounce and silver was down 0.23% to $25.56 an ounce. Platinum was down 0.13% to $1,103.25.

Earlier, we reported that the Gas gets cheaper in Europe amid high supply, good stocks.