Gold prices dipped on Monday, weighed down by a stronger U.S. dollar and investor anticipation for central bank meetings and key U.S. economic data this week.
Spot gold fell 0.5% to $1,993.44 per ounce by 11:48 GMT, while U.S. gold futures declined 0.3% to $2,009.30. The dollar’s rise made gold more expensive for buyers holding other currencies.
Analysts believe gold could quickly rebound above $2,000 if upcoming data and central bank decisions favor lower interest rates. Exinity Chief Market Analyst Han Tan noted, “Bullion could easily be restored back above the $2,000 level, especially if this week’s U.S. CPI print comes in below market expectations, and if the Fed fails to push back on market expectations for U.S. rate cuts.”
Investor focus now shifts to Tuesday’s release of the November U.S. consumer price index, which could offer crucial clues about the Fed’s interest rate policy ahead of its meeting and Chair Jerome Powell’s remarks on Wednesday. While the Fed is widely expected to hold rates steady at 5.25%-5.50% this week, further policy decisions by the European Central Bank, Bank of England, Norges Bank, and Swiss National Bank on Thursday will also be closely watched.
Markets currently anticipate a 44% chance of a U.S. rate cut in March, according to the CME FedWatch tool. Lower interest rates generally benefit gold, which does not bear interest.
In other precious metals, spot silver lost 0.3% to $22.89 per ounce, while platinum edged up 0.7% to $920.91. Palladium, however, dipped 0.4% to $943.44 per ounce.
- Gold prices declined due to a stronger dollar and upcoming central bank meetings.
- The focus shifted to Tuesday’s U.S. CPI data for clues on future interest rate decisions.
- Lower interest rates could favor a rebound in gold prices.
- Other precious metals saw mixed performance, with silver and palladium down slightly and platinum gaining marginally.