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A processed gold bar at a gold exchange house in Pocone, Mato Grosso state, Brazil, on Monday, Aug. 21, 2023. Arthur Menescal | Bloomberg | Getty Images Gold prices retreated for a third

straight session on Wednesday as investors looked for fresh cues on the U.S. central bank's interest rate stance, while palladium hit a five-year low. Spot gold was down 1% at $1,947.89

per ounce by 3:01 p.m. ET (2001 GMT), logging its biggest daily drop since Oct. 2. U.S. gold futures settled 0.8% lower at $1,957.8. Silver fell 0.5% to $22.52 per ounce. "Traders will

start looking at economic data and potential actions from the U.S. central bank. Gold will react based on whatever the data is showing," said Daniel Ghali, commodity strategist at TD

Securities. "It is hard to see a catalyst for further upside in gold without a notable deterioration in the data." A slew of Federal Reserve officials on Tuesday maintained a

balanced tone on the central bank's next decision, but noted they would focus on more economic data and impact of higher long-term bond yields. Fed Chair Jerome Powell is set to speak

at 2:00 p.m. ET on Thursday. Gold is sensitive to rising U.S. interest rates, as they increase the opportunity cost of holding the non-yielding asset. "The risk premium gold gained from

the Israel-Hamas war is eroding. If you see an escalation in the conflict, then gold can get some momentum behind it," said Phillip Streible, chief market strategist at Blue Line

Futures in Chicago. Bullion gained over 7% in October as the conflict in the Middle East boosted safe-haven demand. Elsewhere, palladium hit its lowest levels since 2018 at $1,007.73 earlier

in the session and was down 0.5% at 1,050.06. Platinum eased 2.8% to $866.31. In the palladium market, "demand is evaporating at pretty fast pace led by smaller production of internal

combustion engines and it is also being substituted with platinum in auto catalysts components," Ghali added. Both metals are used in emissions-controlling devices in cars.