Investing.com - Gold prices slipped from three-month highs on Wednesday as weakness in the euro and sterling pushed the dollar to nine-week highs.

At 9:09 AM ET (13:09 GMT), gold futures for December delivery on the Comex division of the New York Mercantile Exchange fell $1.20, or 0.10%, to $1,232.20 a troy ounce, backing away from $1,237.80 reached on Tuesday amid simmering geopolitical tensions.

Meanwhile, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, gained 0.02% to 95.02.

Dollar-denominated assets such as gold are sensitive to moves in the U.S. currency. A gain in the dollar makes gold more expensive for holders of foreign currency and decreases demand for the precious metal.

The dollar index was benefiting from weakness seen in rival currencies such as the euro and pound.

The single currency weakened after data showing that euro zone private sector activity grew at the slowest pace in more than two years in October, as an export-led slowdown widened out to the service sector.

Regarding the British currency, the pound remained under pressure as Brexit talks continued at a standstill and British Prime Minister Theresa May faced intense political criticism over her Brexit strategy, putting in doubt that the UK Parliament will approve any deal she may be able to reach with the European Union.

Gold remained underpinned by continued worries over the impact of the impact of tariffs and trade wars on the global economy.

Further safe haven support came from continuing tension over the death of Saudi journalist Jamal Khashoggi, who disappeared after entering the Saudi consulate on Oct. 2.

Another source of geopolitical tensions comes from Italy’s problematic budget, which the European Commission rejected on Tuesday, marking the first time the EU refused to accept a government’s spending plans.

Looking ahead on Wednesday on the economic front, investors in gold will eye the state of U.S. private sector activity as IHS Markit releases preliminary data on the manufacturing and service sectors on the October survey, which will later be followed by September new home sales in order to gauge the health of the housing market.

Market participants also await Friday’s GDP data that is expected to show that U.S. economic growth slowed in the third quarter from the second, when the economy grew at its fastest pace in four years.

In other metals trading, silver futures gained 0.64% at $14.750 a troy ounce by 9:10 AM ET (13:10 GMT).

Palladium futures lost 1.04% to $1,111.10 an ounce, while sister metal platinumtraded down 0.41% at $832.00.

In base metals, copper rose 0.66% to $2.765 a pound.