Gold fell $19.1 – Fed signals it could raise rates for longer than expected

Gold futures closed lower on Thursday (Nov. 3), with markets pressured by a strong dollar and a rise in U.S. Treasury yields. The Fed signaled a longer-than-expected rate hike.

  • The gold contract was down $19.1, or 1.16%, at $1,630.9 an ounce.
  • Silver was down 16.4 cents, or 0.84%, at $19.43 an ounce.
  • The platinum contract was down $26.8, or 2.82%, at $924.1 an ounce.
  • The palladium futures fell $52, or 2.8%, at $1,798.10 an ounce.

The dollar index against the six major currencies in a basket of currencies rose 1.4% to 112.9260, while the yield on the 10-year U.S. Treasury bond rose to 4.174%.

The strong dollar has made gold contracts priced in dollars more expensive for investors holding other currencies, while a rise in U.S. Treasury bond yields will increase the cost of owning gold. This is because gold is an asset that does not yield interest.

The gold market also came under pressure when the Fed raised interest rates by 0.75% to 3.75-4.00% at its meeting on Wednesday. This is the sixth rate hike this year.

The Fed chairman signaled that it was now too early for the Fed to consider suspending rate hikes. The remarks raised investor concerns that the Fed’s rate hike cycle could last longer than expected.

Markets raised expectations for the Fed’s interest rate ceiling to 5% or more next year from the previous forecast of 4.50-4.75%.

Investors are waiting today for the publication of the U.S. non-farm payrolls figures for October. For October, analysts predicted an increase in the number of jobs by only 205,000, after 263,000 jobs were added in September.

The Spot Market is Open

Friday, November 4, 2022

Metals
Updated at
USD
Bid/Ask
Ounce
Change

Low/High
Gold
12.15
1,648.10
1,649.10
+17.50
+1.07%
1,629.30
1,649.40
Silver
12.15
19.72
19.82
+0.26
+1.36%
19.40
19.85
Platinum
12.15
930.00
940.00
+10.00
+1.08%
915.00
940.00
Palladium
12.00
1,762.00
1,912.00
+38.00
+2.20%
1,722.00
1,912.00
Rhodium
05.00
12,300.00
14,300.00
0.00
0.00%
12,300.00
14,300.00

Leave a Reply

Change Language
%d bloggers like this: