3 months ago
Commodities

Gold Falls as Focus Turns to Fed

Investing.com - Gold prices were lower on Friday, as the U.S. dollar rose in anticipation of a Federal Reserve

Investing.com - Gold prices were lower on Friday, as the U.S. dollar rose in anticipation of a Federal Reserve rate hike next week.

Comex gold futures for February delivery slumped 0.3% to $1,242.95 a troy ounce as of 4:51 AM ET (9:51 GMT).

The price of bullion was pushed lower by a stronger greenback. The Fed is expected to increase rates by 25 basis points at its next meeting on Wednesday, its fourth rate hike this year.

Chances of a hike are priced in at 79.2%, according to Investing.com’s Fed Rate Monitor Tool.

Dollar gains are likely to be short lived however, as the central bank is expected to slow down its pace of rate hikes in 2019.

A mix of inflation data and dovish comments from Fed policymakers has investors uncertain about how many rate hikes there will be next year.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.5% to 97.55.

The precious metal usually falls as the dollar rises, as it is denominated in the U.S. currency and is sensitive to moves. Bullion becomes more expensive for holders of other currencies when the dollar rises and cheaper when it falls.

Other metals were lower on the Comex, with silver futures falling 1% to $14.697 a troy ounce. Among other precious metals, Platinum Futures decreased 0.5% to $793.05 while Palladium Futures dipped 1.5% to $1,172.70 an ounce. Copper futures were down 1.3% to $2.731 a pound.