Gold prices dipped during Asian trading on Wednesday, continuing a decline from recent record highs amid increasing speculation that the Federal Reserve will implement interest rate cuts more slowly in the upcoming months.
The strength of the U.S. dollar also exerted pressure on the broader metals market, as expectations for smaller Fed rate cuts contributed to rising U.S. Treasury yields. Spot gold fell 0.2% to $2,615.90 per ounce, while December gold futures slightly decreased to $2,634.20 per ounce as of 00:57 ET (04:57 GMT). Earlier this month, spot prices had reached a record high of $2,685.96 per ounce.
Fed Minutes and Inflation Data Loom
Gold prices are under pressure from uncertainty surrounding U.S. interest rates, with a growing number of traders betting on a modest 25-basis-point rate cut in November. Later on Wednesday, the minutes from the Fed’s September meeting are expected to shed light on the central bank’s position. In that meeting, the Fed reduced rates by 50 bps and initiated a new easing cycle.
However, robust payroll data for September has cast doubt on the urgency for the Fed to continue aggressive rate cuts, boosting the dollar and weighing on precious metal prices, as higher rates tend to diminish gold’s appeal.
Additionally, consumer price index (CPI) inflation data set to be released on Thursday is anticipated to influence the Fed’s decision-making process.
Mixed Performance Among Precious Metals
Other precious metals displayed mixed results on Wednesday, with most still facing losses from recent sessions. Platinum futures fell 0.1% to $964.90 per ounce, while silver futures gained 0.8% to $30.865 per ounce.
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