Gold prices continued their decline on Wednesday as investors engaged in profit-taking following recent record highs, while awaiting U.S. inflation data later this week, which could provide further guidance on the Federal Reserve’s interest rate path.
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Spot gold fell 0.3% to $4,113.54 per ounce at 01:15 GMT. The previous day, gold had plunged more than 5%, marking its largest one-day drop since August 2020. Meanwhile, U.S. December gold futures rose 0.5% to $4,129.80 per ounce.
U.S. President Donald Trump expressed optimism about reaching a fair trade agreement with Chinese President Xi Jinping during their upcoming meeting in South Korea, downplaying potential tensions over Taiwan.
Gold surged about 56% this year, hitting an all-time high of $4,381.21 per ounce on Monday, fueled by geopolitical and economic uncertainty, bets on interest rate cuts, and ongoing central bank purchases.
Investors are looking ahead to the U.S. Consumer Price Index report for September, scheduled for Friday after a government shutdown delayed its release. A Reuters survey of economists indicates that the Federal Reserve is likely to cut its benchmark interest rate by 25 basis points next week, with another cut expected in December.
Meanwhile, the European Central Bank is not expected to lower rates in the near term. Gold typically rises when interest rates fall, as lower rates reduce the opportunity cost of holding the non-yielding metal.
Other precious metals saw declines as well: silver dropped 0.9% to $48.29 per ounce, platinum fell 1.1% to $1,534.44, while palladium remained steady at $1,406.76 per ounce.
Source: Reuters
