Gold sheds gains as hot inflation figures, higher dollar weigh
GLD•Gold fell 0.41% to $4,014.26 an ounce after rising earlier, as hotter-than-expected US inflation and a stronger dollar weighed on prices. Markets priced in a full 25-basis-point Fed hike in December, while bets on a 50-basis-point increase rose to 13.2%.
1. Gold retreats
Spot gold fell 0.41% to $4,014.26 per ounce by 1447 GMT on Wednesday, after reaching $4,066.77 earlier in the session. US gold futures for December delivery slipped 0.2% to $4,021.70. Gold had fallen about 3% on Tuesday after US consumer prices rose 0.4% in October, compared with economists’ 0.3% forecast.
2. Rate expectations rise
Fed Governor Christopher Waller said before the inflation data that a 0.3% October core inflation reading would prompt him to consider a half-point rate hike in December. Markets fully priced in a 25-basis-point increase, while bets on a 50-basis-point hike rose to 13.2% from zero, lifting the dollar to a four-week high. A StoneX strategist said central-bank buying in the third quarter had helped support gold despite pressure from Fed policy and interest rates.
3. Other metals advance
Spot palladium gained 5.2% to $1,078.56 per ounce, reaching its highest level since October 22. Deutsche Bank said palladium markets may be moving toward a persistent surplus as autocatalyst demand erosion meets recovering secondary supply. Spot silver rose 1.41% to $52.23 per ounce.
