02:00 PM EDT, 10/02/2024 (MT Newswires) -- (Updates prices.)

Gold traded lower midafternoon on Wednesday as traders chose to take profits following last week's record high while the dollar rose following Iran's day-prior missile attack on Israel.

Gold for December delivery was last seen down US$20.50 to US$2,669.80 per ounce.

Iran on Tuesday launched an estimated 180 ballistic and hypersonic missiles at Israel in retaliation for the killing of Hassan Nasrallah, leader of the Hezbollah militia in Lebanon, along with other senior leaders of the Iran-backed group. The strike was Iran's second on Israel this year.

"The missile strikes, including around 180 projectiles, come hours after Israel commenced ground operations in Lebanon, an action that Iranian diplomats had signaled during UN General Assembly week would constitute a redline. Like in April, Iran provided advance warning of the military action, allowing US forces to mobilize for Israel's defense," Helima Croft, Head of Global Commodity Strategy and MENA Research, at RBC Capital Markets, noted.

There were no injuries reported in Israel from the strike, according to The Guardian, and most of the missiles were destroyed by air defenses. Still, Israel and the United States are threatening to retaliate against Iran for the attack. But despite the threat of a wider Middle Eastern war, the safe-haven buying that usually accompanies heightened geopolitical tensions did not push gold higher.

"Gold rose more than 1% (on Tuesday) but without challenging last week's record high, potentially highlighting a market where short-term focused traders have started to book some profit following gold's strong September rally," Saxo Bank noted.

The dollar rose early, with the ICE dollar index last seen up 0.41 points to 101.6.

Treasury yields rose, with the U.S. two-year note last seen paying 3.633%, up 1.8 basis points, while the yield on the 10-year note was up 4.7 basis points to 3.784%.