Gold prices were modestly lower on Monday, after posting a gain last week, as investors eyed moves in the U.S. dollar and Treasury yields for cues on the next moves for the precious metal ahead of a Federal Reserve policy meeting.
Price action
-
Gold futures for December delivery
GCZ23,
+0.10% GC00,
+0.10%
declined by $2.20, or 0.1%, to $1,944 per ounce on Comex. -
Silver futures for December delivery
SIZ23,
-0.18% SI00,
-0.18%
were down 14.6 cents, or 0.6%, at $23.24 per ounce. -
Platinum futures for October
PLV23,
+0.60%
gained $4.50, or 0.5%, to $934 per ounce, while palladium futures
PAZ23,
-1.17%
shed $17.20, or 1.4%, to $1,235.50. -
Copper for December delivery
HGZ23,
-0.79%
shed 0.9% to $3.7665 per pound.
Market drivers
Precious-metals prices were seeing subdued moves on Monday, sticking to a tight trading range, with Japanese traders out on holiday and investors around the world waiting to hear from Federal Reserve Chairman Jerome Powell.
“The precious metals markets are pausing early this week, ahead of this week’s key FOMC meeting,” said Jim Wyckoff, senior analyst at Kitco.com.
The Fed’s two-day September policy meeting concludes on Wednesday. The central bank is expected to leave interest rates on hold.
The ICE U.S. Dollar Index
DXY,
a gauge of the greenback’s strength against a basket of rivals, was little changed at 105.34.
Month to date, gold prices have moved marginally lower, “primarily reflecting the uptrend in U.S. real yields, although it remains roughly 6% higher over 2023,” analysts at ICICI Bank wrote in a recent research note.
“With markets pricing in a ‘soft-landing’ scenario for the U.S. economy…we see limited downside in U.S. yields that will ensure that gold prices trade with a downside bias in 2023,” they said.
Still, “a reversal in gold prices is possible if the FOMC pivots to a neutral regime and prepares markets for possible rate cuts” the second quarter of 2024 onwards,” the ICICI Bank analysts said.
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