Gold prices rose in Asian trading, continuing their strong gains as markets increasingly bet that the U.S. Federal Reserve will cut interest rates in December. Caution ahead of a series of important U.S. economic data also boosted demand for safe haven assets, supporting the precious metal’s rise despite the dollar remaining at strong levels, while other metals also saw price increases.
Spot gold climbed about 0.3% to $4,145.57 per ounce, while February gold futures rose 0.2% to $4,180 per ounce. This comes amid a clear increase in market expectations for a rate cut in December following dovish comments from two Federal Reserve officials. Markets currently price in over a 77% probability of a 25 basis point rate cut at the December 9-10 meeting, compared with about 42% the previous week, according to CME’s FedWatch tool.
Rate cuts typically favor non yielding assets like gold, as they reduce the attractiveness of bonds. Gold has reached several record levels this year, fueled by consecutive rounds of rate cuts. Rising tensions between China and Japan, along with concerns over expanding government spending in advanced economies, have also supported demand for gold as a safe haven.
In other metals markets, spot platinum rose 0.5% to $1,570.65 per ounce, while spot silver increased 0.8% to $51.5555. London Metal Exchange copper futures jumped 1.2% to $10,887 per ton.
Overall, metal movements remain relatively limited as markets await key upcoming U.S. economic data, including the Producer Price Index, retail sales, and the Personal Consumption Expenditures (PCE) index, the Fed’s preferred inflation gauge. Official statements indicate that October inflation and employment data will not be released due to the government shutdown that month, which previously had reinforced expectations for a December rate pause amid the Fed’s lack of recent data ahead of its final meeting of the year.
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