LONDON: Gold fell on Wednesday as the dollar gained after comments from US Federal Reserve officials raised expectations of an interest rate hike in March and overshadowed President Donald Trump`s first major policy speech to Congress.

The probability of a March rate hike jumped to 67.5 per cent from roughly 30pc after the Tuesday comments from Fed officials, according to Thomson Reuters data.

`Rate rises are now priced in to futures but not in to gold, so the risk is to the downside (for gold),` said Mitsubishi analyst Jonathan Butler. Rising US interest rates increase the opportunity cost of holding nonyielding gold, while boosting the dollar.

Spot gold dropped 0.6pc to $1,241.50 an ounce by 1524 GMT, heading for a third straight day of losses.

The metal hit its highest since Nov 11 at $1,263.80 on Feb. 27. US gold futures fell 1pc to $1,241.80.

DataonWednesday showed US consumer price inflation jumped in January by 0.4pc.

Spot silver edged up 0.1pc to $18.33 an ounce, platinum fell 0.7pc to $1,012.74 and palladium gained 0.7pc to $772.15.-Reuters