Investing.com - Gold prices turned lower on Wednesday, as the release of strong U.S. inflation data sent the greenback broadly higher.

Comex gold futures were down 0.50% at $1,323.6 a troy ounce by 08:40 a.m. ET (12:40 GMT), off a one-week high of $1,339.4 hit earlier in the day.

The U.S. Commerce Department said consumer prices rose more than expected in January by 0.5%. Year-over-year, consumer prices increased 2.1% last month a year earlier, beating expectations for a gain of 1.9%.

Rising inflation would be a catalyst to push the Federal Reserve toward raising interest rates at a faster pace than currently expected.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.40% at 89.96, off a one-week trough of 89.28 hit overnight.

Gold is sensitive to moves in both U.S. rates and the dollar. A stronger dollar makes gold more expensive for holders of foreign currency, while a rise in U.S. rates lifts the opportunity cost of holding non-yielding assets such as bullion.

Also Wednesday, the U.S. Commerce Department said retail sales fell 0.3% in January, disappointing expectations for a 0.2% rise.

Core retail sales, which exclude automobile sales, were unchanged last month, compared to expectations for a 0.5% rise.

Elsewhere on the Comex, silver futures were down 0.77% at $16.38 a troy ounce.