Gold prices moved sideways after two sessions of increase as investors reduced expectations that the US Federal Reserve (FED) would cut interest rates next month.
Spot gold remained around $4,070 an ounce, after rising nearly 1% in the previous two sessions. The US will not release the October jobs report, leaving Fed officials lacking important data before the final meeting of the year. Meanwhile, the minutes of the October meeting showed that many policymakers considered keeping interest rates unchanged for the rest of 2025 as appropriate.
Gold often benefits in a low interest rate environment due to not generating profits, so the Fed's policy holds the Fed's policy may reduce the attractiveness of the precious metal. In addition, the USD strength index recorded its strongest increase since late September on Wednesday, adding pressure when making gold more expensive for the majority of buyers.
Gold prices have risen strongly this year, rising more than 50% and setting a record in October before partially adjusting. The increase was supported by two previous Fed rate cuts, along with large buying from central banks and capital flows into gold-backed ETFs.
Gold prices narrowed the increase after the meeting minutes showed the FED was divided, although the agency cut interest rates last month despite concerns that too early easing could slow down the process of controlling inflation, according to Mr. Manav Modi - an analyst at Motilal Oswal Financial Services Ltd. He said uncertainty increased when the October jobs report was canceled.
Expectations of a Fed rate cut at its December meeting have fallen significantly. swap contracts associated with the Fed's operating interest rate currently indicate a probability of a cut of about 35%, compared to nearly 50-50 previously.
Investors will then turn their attention to the September jobs report, due at 8:30 a.m. New York time, after being delayed due to government shutdowns.
In Singapore at 1:51 p.m., gold prices fell 0.2% to $4,070.06/ounce. Bloomberg Dollar spot moved sideways after rising 0.5% on Wednesday. Silver prices held above $51 an ounce after fluctuating strongly, while platinum and palladium both increased.
