Investing.com — Gold prices fell Friday, pressured by expectations that the Federal Reserve’s December rate cut will come with a less dovish outlook.
fell 1.2% to $2,648.64 per ounce, while February maturing bonds were 1.6% lower at $2,666.00 per ounce.
Gold has been under pressure this week due to the strength of the dollar as the Fed meeting looms
Still, the yellow metal pared some of its gains this week after snapping a two-week winning streak ahead of next week’s Fed meeting.
While the central bank is widely expected to do so, markets have become more uncertain about its long-term plans for interest rates, especially as data this week showed U.S. inflation remained stubborn.
The Fed is expected to cut rates at a slower pace in 2025, after cutting rates by 75 basis points so far in 2024. The expansionary and inflationary policies under incoming President Donald Trump are also expected to keep interest rates higher in the long term.
High rates put pressure on metal prices as the opportunity cost of investing in non-performing assets increases. While gold hit a series of record highs this year as the Fed began cutting interest rates, the pace of gains has slowed in recent months.
In addition to the Fed, interest rate decisions in Japan and England will also be central next week.
Other precious metals retreated on Friday after also losing ground in recent sessions. fell 1.4% to $927.80 per ounce, while the price fell 2% to $2,666.00 per ounce.
Copper prices fall while China CEWC disappoints
Among industrial metals, copper prices fell on Friday, extending their decline from Thursday, as traders were largely unimpressed by stimulus signals from an economic summit in China.
The benchmark on the London Metal Exchange was steady at $9,060.00 per tonne, while February fell 1.2% to $4.1952 per pound.
China’s Central Economic Work Conference – a high-level meeting of government officials – revealed few details about the country’s plans to release more stimulus measures and support the economy.
Expectations for the CEWC were high after China’s Politburo issued its mildest signals earlier this week. But the CEWC gave no more indications about the promised measures.
(Ambar Warrick contributed to this story.)
