Gold prices slip as stronger dollar, Fed uncertainty weigh
Gold slipped slightly Tuesday, pressured by a stronger U.S. dollar and lingering uncertainty over the Federal Reserve’s next policy move.
At 09:00 ET (14:00 GMT), Spot gold fell 0.8% to $3,970.08 per ounce and U.S. Gold Futures declined 0.8% to $3,980.31 per ounce.
The metal has struggled to hold above the $4,000 mark as the dollar extended gains, making bullion more expensive for overseas buyers.
Gold pressured by stronger dollar
The dollar climbed to a three-month high against major currencies on Monday, underpinned by fading bets of another rate cut this year.
Fed Chair Jerome Powell last week signaled that the central bank is not yet committed to further easing, saying a December move was “not a foregone conclusion." Markets have since scaled back expectations of a rate reduction this year.
Adding to the uncertainty, several Fed officials on Monday voiced competing views on the economy. Some policymakers emphasized the need for vigilance against inflation, while others pointed to signs of slowing labor-market momentum.
The split reinforced doubts about how soon the Fed might resume cutting rates, keeping the dollar supported.
Gold, which yields no interest, tends to lose appeal when rates stay high or the dollar strengthens. The prospect of fewer rate cuts and higher real yields has weighed on investor demand.
Still, the metal remains supported to a certain degree by the fragile U.S.-China trade relations.
Recent signs of progress between Washington and Beijing have calmed markets, but renewed concerns over advanced chip exports have eroded the optimism.
Metal markets also drop
Other precious and industrial metals also traded lower as a stronger dollar weighed.
Silver Futures dropped 1.5% to $47.325 per ounce, and Platinum Futures fell 2.2% to $1,545.75/oz.
Benchmark Copper Futures on the London Metal Exchange slipped 1.6% to $10,670.20 a ton, and U.S. Copper Futures also declined 2.1% to $4.9593 a pound.
Source : Investing.com
