Gold prices edged down on Monday as investors awaited the release of key U.S. economic data for additional insight into the Federal Reserve‘s monetary policy path.
In the UAE, gold prices rose AED0.5 with 24-carat gold inching up to AED291.25 per gram, while 22-carat gold rose to AED269.75. Twenty-one-carat gold reached AED261 while 18-carat gold reached AED223.75.
Globally, spot gold declined 0.31 percent to $2,403.92, as of 4:55 GMT, after hitting a record high of $2,483.60 last week. Meanwhile, U.S. gold futures gained 0.31 percent to $2,406.70.
Despite the dollar index declining 0.08 percent to 104.31, gold prices declined. A weaker dollar tends to make gold more attractive to buyers holding other currencies.
U.S. elections and rate cut prospects
Interest rate cut expectations and the political uncertainty in the United States have supported gold prices to their record high earlier last week. Despite today’s decline, analysts believe that those factors will continue to support gold, which will likely see another record-high before the end of 2024.
Markets are pricing in a 97 percent chance of an interest rate cut in September, according to the CME FedWatch Tool. Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold.
U.S. economic data
As gold prices decline from their record high, market focus shifts to Friday’s U.S. personal consumption expenditures (PCE) data. In addition, this week will see the release of existing home sales data, July’s S&P Global flash PMIs, advance second-quarter GDP, and weekly jobless claims data.
Read | How to trade in commodities: A beginner’s guide
Other precious metals
The precious metals market mirrored the decline in gold prices with spot silver declining 0.60 percent to $29.08. Meanwhile, palladium rose 1.47 percent to $919.25 while copper declined 0.20 percent to $4.21. Platinum lost 0.27 percent to $959.89.
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