Gold Declines as Dollar Rises, Focus on US Inflation Data
Gold prices fell as the dollar rose, with attention on inflation data following the Federal Reserve's decision.
Translated by Qiyas from الراي — Original source
Gold prices fell on Thursday as the US dollar rose, with investors assessing monetary policy signals from the Federal Reserve and its chairman, Kevin Warsh, after the central bank kept interest rates unchanged. Markets are now awaiting US inflation data to be released later today.
By 00:44 GMT, spot gold prices dropped 0.7 percent to $4,039.26 per ounce, while US December gold futures settled at $4,051.
The Federal Reserve kept interest rates unchanged on Wednesday as expected, opting to delay any changes in borrowing costs until after next week’s midterm elections, pending further data on inflation, which the central bank stated remains “elevated.”
According to CME Group’s FedWatch tool, traders see a 78 percent probability of a rate hike in December, down from 84 percent prior to the central bank’s decision.
Higher interest rates increase the opportunity cost of holding gold, which yields no return, thereby reducing its appeal to investors.
Markets are also awaiting personal consumption expenditure (PCE) data scheduled for release at 12:30 GMT, a key indicator closely monitored by the Federal Reserve as it strives to achieve its 2 percent inflation target.
Among other precious metals, spot silver fell 0.7 percent to $53.60 per ounce, platinum declined 0.3 percent to $1,533.50, while palladium rose 0.7 percent to $1,017.29.
