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Gold futures inched lower on Monday after clinching a sixth straight week of gains — the longest such winning streak for a most-active contract since August 2020, according to Dow Jones Market Data.
Price action
-
Gold for April delivery
GC00,
-0.13% GCJ23,
-0.12% ,
which is now the most actively traded contract, fell by $5.20, or 0.3%, to $1,940.40 an ounce on Comex. -
Silver prices for March
SI00,
+0.77% SIH23,
+0.77%
increased by 9.8 cents, or 0.4%, to $23.72 an ounce. -
March palladium
PAH23,
+1.52%
rose $6.80, or 0.4%, to $1,606.50 an ounce, while platinum for April
PLJ23,
-0.01%
fell $2, or 0.2% to $1,014.80 an ounce. -
Copper for March
HGH23,
-0.26%
fell by 2.2 cents, or 0.5%, to $4.2005 a pound.
Market drivers
Precious metals analysts blamed gold’s Monday pullback on profit-taking following an epic bull run that sent the yellow metal to a nine-month high.
What’s more, traders are also waiting to see whether Federal Reserve Chairman Jerome Powell will try to take investors down a peg by signaling that the Fed is nowhere near finished with its battle against inflation.
“Gold is seeing a modest corrective pullback and some mild profit taking from the futures traders ahead of this week’s highly anticipated monetary policy meeting of the U.S. Federal Reserve,” said Jim Wyckoff, senior analyst at Kitco.com.
The Fed’s two-day policy meeting will conclude Wednesday with what’s expected to be a 25 basis point interest-rate hike and a policy statement, followed by Powell’s news conference. Several other central banks are set to meet this week, including the European Central Bank and Bank of England.
The latest inflation figure out of the U.S. showed that the pace at which the price of consumer goods is rising continues to slow and “this has provided more bandwidth for the Fed to operate within and increased expectations that this week’s rate decision will bring a 25-basis point hike,” said Rupert Rowling, market analyst at Kinesis Monday. That’s “three times smaller than most of the increases in 2022.”
“This less aggressive stance by the Fed has long since been priced in for gold, with this change in sentiment being the catalyst for the precious metal’s impressive rally from early November onwards,” he said in daily market commentary.
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