Gold down for seventh consecutive session as US Fed stays hawkish
GOLD continued its slide on Tuesday (Oct 3), clocking its longest losing streak since August 2022 in the last session as Federal Reserve officials underscored the likelihood interest rates will stay high, with US job openings data expected later in the day.
Spot gold was down 0.2 per cent at US$1,824.10 per ounce by 0057 GMT, falling for a seventh consecutive session to its lowest since Mar 9. US gold futures fell 0.4 per cent to US$1,840.50.
The US dollar scaled a 10-month peak, while Treasury yields hovered near 16-year highs after the US government averted a partial shutdown and economic data supported the prospects of rates staying higher for longer.
US manufacturing took a step further towards recovery in September as production picked up and employment rebounded, according to a survey on Monday that also showed prices paid for inputs by factories falling considerably.
Fed officials say monetary policy will need to stay restrictive for “some time” to bring inflation back down to its 2 per cent target, but their unity around that phrase masks an ongoing debate over another possible rate hike this year.
Higher rates raise the opportunity cost of holding bullion, which is priced in US dollars and does not yield any interest.
Markets priced in a 45 per cent chance of another 25-basis-point rate hike this year, but also expect a 41 per cent possibility of some monetary policy easing in the first half of 2024, according to the CME FedWatch tool.
Spot silver dipped 0.8 per cent to US$20.90 per ounce, its lowest level in six and a half months, while platinum edged down 0.1 per cent to a one-year low of US$876.42. Palladium gained 0.5 per cent to US$1,206.84. REUTERS
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