Gold Holds Decline as Traders Focus on Uncertain 2025 Rate Path
Gold held a decline as traders weighed the prospect for a slower pace of interest-rate cuts by the Federal Reserve next year.
Bullion was near $2,616 an ounce after closing 0.4% lower on Monday. Investors are digesting the latest data on consumer confidence, which unexpectedly sank in December on concerns about the economy due to uncertainty linked to the policies of the incoming Trump administration.
Earlier this month, the Fed reined in the number of rate cuts expected in 2025 as Chair Jerome Powell made clear that the central bank needs to see price pressures ease further. Lower borrowing costs are typically a positive for the precious metal, which doesn’t pay interest.
Bullion has hit successive record highs this year and is set to close 2024 more than 25% higher. Gold has been supported by US monetary easing, safe-haven demand and buying by central banks, but the rally has recently slowed as the dollar strengthened after the election of Donald Trump.
The Bloomberg Dollar Spot Index was flat on Tuesday, after climbing 0.3% in the previous session. A stronger greenback makes commodities priced in the currency more expensive for most buyers.
Spot gold was steady at $2,616.38 an ounce at 8:56 a.m. in Singapore. Silver, platinum and palladium were little changed.
Source: Bloomberg
