PT Rifan Financindo Berjangka – Gold Steadies as Traders Look to Final Fed Meeting of the Year
Gold was steady as traders remained cautious ahead of interest-rate decisions by major central banks, including the Federal Reserve.
Bullion traded near $2,650 an ounce, after notching a modest gain in the previous session as investors parsed mixed US data. Activity at US service providers is expanding at the fastest pace since October 2021, while a measure of New York state factory activity retreated by the most since last May.
The Fed makes it final rate decision of the year on Wednesday, which will be followed by policy announcements in Japan and the UK this week. Swaps markets are almost fully pricing in a quarter-point Fed cut, and traders will focus on policymakers’ language for clues on the 2025 outlook. Lower rates are typically positive for gold, which doesn’t pay interest.
The precious metal has risen by around 29% this year, putting it on track for its biggest annual gain since 2010. Its strength has been supported by easing in the US, safe-haven demand and sustained buying by the world’s central banks.
Spot gold was little changed at $2,651.93 an ounce at 7:57 a.m. in Singapore. The Bloomberg Dollar Spot Index was flat. Silver and palladium slipped, while platinum was little changed.
Source : Bloomberg
Gold gains as US dollar ease ahead of Fed policy meeting
Spot gold prices gained on Monday, supported by ongoing geopolitical concerns and a softer dollar, as markets awaited the Federal Reserve’s policy meeting, where a third rate cut and clues on the 2025 outlook are expected.
Spot gold was up 0.2% at $2,654.27 per ounce as of 01:41 p.m. ET (1841 GMT). U.S. gold futures settled 0.2% lower at $2,670.
“I think the continuous presence of geopolitical risks are contributing to gold’s strength,” said Nitesh Shah, commodity strategist at WisdomTree.
Also, “China has resumed gold buying. So gold is reacting to a multitude of these things,” Shah noted, adding that top consumer China was likely to ramp up policy stimulus to revive its economy, which would further support gold.
On the geo-political front, Israel agreed on Sunday to double its population in the Golan Heights, citing Syrian threats despite the moderate tone of rebel leaders who ousted President Bashar al-Assad a week ago.
Bullion is considered a safe investment during economic and geopolitical turmoil, while a low-interest rate environment also makes the non-yielding bullion more attractive.
The Fed is expected to cut rates by a quarter point at its two-day meeting starting on Tuesday, while updating its outlook for 2025 and beyond.
“The economic and political background is generally supportive for gold – but the Fed may cap prices if it points to an extended pause in rate cuts after December,” said StoneX analyst Rhona O’Connell.
The dollar index (.DXY), opens new tab fell 0.1%, retreating from a near three-week high reached on Friday, making dollar-priced bullion more affordable for holders of other currencies.
Citi projects strong gold and silver demand until U.S. interest rates stabilize, forecasting a peak for both metals in late 2025 to early 2026.
Key data releases this week, including U.S. GDP and inflation figures, could further influence market sentiment.
Spot silver was steady at $30.57 per ounce, platinum gained 1.1% to $934.70, while palladium was down 0.8% at $944.37. PT Rifan Financindo Berjangka.
Source: Reuters