Gold futures had the biggest three-day loss since early November as the dollar climbed and traders increased bets that the Federal Reserve will tighten U.S. monetary policy this year.

The Bloomberg Dollar Spot Index gained for a second day, reducing the appeal of commodities including gold that are priced in the U.S. currency. Traders are betting there’s a 52 percent chance that U.S. policy makers will raise interest rates by June, up from 6 percent a month ago, according to Fed-fund futures.

Greater stability in financial markets after monetary intervention by central banks could ease the Fed’s path to raising rates, hurting gold prices because the metal doesn’t pay interest. While the Bank of Japan refrained from bolstering monetary stimulus at its meeting Tuesday after a surprise move to adopt negative rates in January, it reiterated it could loosen policy if needed. The European Central Bank last week announced unprecedented easing.

Gold futures for April delivery fell 1.1 percent to settle at $1,231 an ounce at 1:48 p.m. on the Comex in New York, taking losses in the past three sessions to 3.3 percent, the biggest such decline for a most-active contract since Nov. 2.

Source : Bloomberg