Gold prices slides to fourth-straight loss as dollar rebounds

Investing.com– Gold prices gave up gains Wednesday, suffering a fourth-straight loss as the dollar rebounded from session lows despite in-line US inflation data supporting bets for a December Federal Reserve rate cut. 

At 3:30 p.m. ET (20:30 GMT), spot gold rose 0.9% to $2,574.85 an ounce, while gold futures fell 1% to $2,580.30 an ounce. 

Gold in fourth-straight decline as dollar rebounds after CPI release

The {{942611|dollar } rebounded from session lows, shrugging off growing expectations for a December rate cut following in-line inflation data earlier Wednesday. 

The consumer price index, a key gauge of price growth in the world’s largest economy, rose by 2.6% on an annualized basis last month, compared to 2.4% in September. Month-on-month, the figure moved up by 0.2%, matching September’s pace.

Meanwhile, the so-called “core” measure, which strips away more volatile items like food and fuel, increased by 3.3% year-over-year and 0.3% on a monthly basis. Both equalled the metric logged in September.

Remarks from Fed officials following the report was mixed. Minneapolis Fed President Neel Kashkari said the data showed inflation is on the right track. St. Louis Fed President Albert Musalem said the “recent information suggests to me that the risk of inflation ceasing to converge toward 2%, or moving higher, has risen.”

Several more Fed officials are set to speak this week, most notably Chair Jerome Powell on Thursday. 

The central bank has cut interest rates by a total 75 basis points in the past two months, and is expected to cut rates by 25 bps in December.

Broader precious metals also rose on Wednesday, recouping some recent losses. Platinum futures fell 0.7% to $941.90an ounce, while silver futures rose 1% to $30.468 an ounce. 

Copper nurses China losses

Among industrial metals, copper prices fell slightly on Wednesday, and were nursing sharp losses in recent sessions as new fiscal measures from top importer China largely underwhelmed.

Benchmark copper futures on the London Metal Exchange fell 1.4% to $9,016.00 a ton, while December copper futures fell 0.4% to $4.07 a pound. 

China approved a 10 trillion yuan ($1.4 trillion) debt package to support local governments. But traders were disheartened by a lack of targeted measures to support consumption and the property market. 

Analysts said Beijing was likely seeking more clarity on what a Trump presidency will entail for the country, before approving more fiscal measures. Trump has vowed to impose steep import tariffs on China.

Citi cuts copper price forecast

Citi Research has revised down its copper price forecast for the short term, signaling that ongoing trade tensions between the United States and China, coupled with weaker-than-expected economic growth in China, are likely to dampen global demand for copper. 

This reassessment, in a note released released earlier Wednesday, projects copper prices falling to $8,500 per metric ton in the near term, down from an earlier forecast of $9,500 per metric ton, with an average price of $9,000 per metric ton for the fourth quarter of 2024.

The outlook reflects Citi’s concerns over the resilience of global manufacturing demand, a critical driver for copper consumption. 

(Peter Nurse, Ambar Warrick contributed to this article.)