Gold prices witnessed a decline during the beginning of Asian market trading, today, Thursday, as investors await the monetary policy meeting of the Federal Reserve (the US Central Bank) scheduled to be held next week, searching for indicators that will determine the future path of interest rates.
In immediate performance, the yellow metal fell by 0.6%, recording $4,115.50 per ounce, after touching its lowest level since October 15 at $4,104.33 on Wednesday. US gold futures contracts for December delivery also fell by 0.4%, reaching $4,132.30, according to the latest Asian market data seen by the “Al-Mashhad” platform.
This comes as a poll conducted by Reuters showed a consensus among economists to rule out the US Federal Reserve raising interest rates at this month’s meeting, as policymakers adhere to a patient approach despite continued stubborn inflation pressures that may later require more stringent measures.
Traders are cautiously awaiting the monetary policy meeting scheduled for October 27 and 28, in addition to the personal consumption expenditure data expected next week. Which is a key indicator that the Central Bank relies on to follow the goal of reducing the inflation rate to 2%.
Data from the CME Fed Watch tool indicate a decline in the chances of the US Central Bank raising interest rates next week to less than 16%, compared to expectations of up to 90% to approve an increase next December. It is known economically that high interest rates put negative pressure on gold, due to the high opportunity cost of owning the metal, which does not generate a direct return.
