Gold prices declined in European trading on Tuesday, marking a second consecutive session of losses, pulling back from a two-week high amid profit-taking and a stronger dollar against major currencies.
The drop followed hawkish comments from Federal Reserve official Christopher Waller, which dampened the likelihood of an interest rate cut in November
Gold Prices
Gold prices dropped 0.4% today to $2,638 an ounce, after reaching a session high of $2,655. On Monday, the metal declined by 0.3%, marking its first loss in three days, pulling back from two-week highs at $2,666.
The Dollar
The dollar index rose by 0.15% on Tuesday, extending its gains for the sixth consecutive session and nearing two-month highs at 103.36. The dollar’s strength was driven by robust U.S. economic data and hawkish comments from Federal Reserve officials.
Waller’s Remarks
Federal Reserve official Christopher Waller urged caution regarding potential future interest rate cuts, citing recent U.S. economic data. He also highlighted concerns about labor data, noting that recent hurricanes and the Boeing strike could distort upcoming payroll reports, potentially reducing October's job gains by 100,000.
Following Waller’s comments, the probability of a 0.25% rate cut by the Fed in November slightly decreased to 85%, while the chances of keeping rates unchanged rose to 15%.
SPDR Gold Trust
Gold holdings in the SPDR Gold Trust increased by 2.59 tonnes yesterday, bringing the total to 880.57 tonnes, the highest level since late 2023.