Gold prices edged lower on Thursday as a firmer U.S. dollar and waning expectations of a Federal Reserve rate cut in December weighed on investor sentiment. The decline comes as global markets await the long-delayed U.S. jobs report, expected to offer fresh clues on the Fed’s policy direction.
As of 0653 GMT, spot gold fell 0.4% to $4,063.81 per ounce, while U.S. gold futures for December delivery dropped 0.5% to $4,063.60.
Market analysts say the primary pressure on gold stems from a sharp pullback in rate-cut bets over the past two weeks.
“Gold right now is down primarily due to the fact that the rate-cut bets have been pared back quite remarkably,” said Kelvin Wong, senior market analyst at OANDA. He added that in the near term, gold is likely to remain subdued below the $4,100 mark, with resistance seen at $4,155. If downward pressure persists, prices could slip toward the $4,000–$3,980 range.
The U.S. dollar index climbed to its highest level in more than two weeks, making gold—priced in dollars—more expensive for buyers using other currencies, further limiting demand.
The latest minutes from the Fed’s October meeting, released on Wednesday, indicated that the central bank proceeded with a rate cut despite policymakers’ warnings that loosening too quickly could fuel inflation or erode public trust. Following the release, traders sharply revised expectations for another rate cut in December. The CME Group’s FedWatch tool now places the probability at nearly 33%, down from 49% a day earlier.
Gold, a non-yielding asset, typically benefits in a low-interest-rate environment and during periods of economic uncertainty.
Attention now shifts to the U.S. non-farm payrolls report for September, which was delayed due to the recent U.S. government shutdown. Economists surveyed by Reuters expect the data to show that employers added 50,000 jobs last month—an outcome that could influence the Fed’s next moves.
Meanwhile, investor appetite for gold-backed instruments showed a modest uptick. The SPDR Gold Trust, the world’s largest gold ETF, reported that its holdings rose by 0.22% to 1,043.72 tonnes on Wednesday, up from 1,041.43 tonnes the previous day.
In other precious metals trading, spot silver slipped 0.6% to $51.07, platinum held steady at $1,546.80, and palladium gained 0.6% to $1,388.58.
WHAT YOU SHOULD KNOW
Gold prices dipped as a stronger dollar and reduced expectations for a December Fed rate cut pressured the market, with investors now awaiting the delayed U.S. jobs report for clearer direction on future monetary policy.
