(Bloomberg) -- Gold held the biggest drop in more than a week after the US dollar rose to the highest since May, blunting demand.

Spot bullion steadied near $3,937 an ounce after sinking almost 2% in the prior session. A gauge of the US currency rose for a fifth day on Tuesday — its best run since July — as traders reassessed the likelihood of another interest-rate cut from the Federal Reserve next month. A stronger greenback makes commodities including gold more expensive for most buyers.

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Earlier this week, a trio of Fed policymakers stopped short of supporting an additional cut in December as they weighed the competing risks from inflation and a softer labor market. Investors will the have opportunity to hear additional viewpoints this week, with St. Louis Fed President Alberto Musalem and Cleveland Fed chief Beth Hammack among officials slated to make remarks.

Gold remains about 50% higher year-to-date, with prices touching a record last month before retracing some gains. The pullback was accompanied by withdrawals from bullion-backed exchange-traded funds, although the pace of the outflows has tailed off in recent days.

“It should not be a big surprise to see the yellow metal consolidated in a lower, $3,800-to-$4,050-an-ounce trading range,” TD Securities strategist Bart Melek said in a note, citing factors including ambiguities over the outlook for Fed rate cuts, as well as concerns over retail buying in China.

Still, the factors that contributed to gold’s gains this year are still mostly intact, and elevated official-sector buying and strong demand from private investors should send prices back up after the consolidation phase, he added.

Gold was little changed at $3,936.66 an ounce at 8:28 a.m. in Singapore. The Bloomberg Dollar Spot Index was steady. Silver was flat, while palladium and platinum dropped.

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