Gold Prices Unchanged in Asian Trade as Year-End Volume Drops
Gold prices remained largely unchanged in Asian trade on Tuesday, marking a subdued start to the new year despite setting for significant yearly gains on the back of the US Federal Reserve’s interest rate cuts in 2024.
The yellow metal was trading at $2,607.65 per ounce, while the February contract edged 0.2% lower to $2,620.22 an ounce. Thin year-end trading volumes and a reluctant market were contributing to the lackluster market sentiment.
Gold has seen a 26% rise in 2024 due to the Fed’s rate cuts and geopolitical tensions worldwide. With interest rates low, investors tend to allocate more capital to gold as a store of value and a hedge against uncertainty. However, the Fed’s December meeting acted as a stumbling block, as policymakers forecasted only two more rate cuts in 2025, rather than the expected four.
The stronger dollar has been weighing on gold prices, making the metal more expensive for buyers using other currencies. Other precious metals, such as silver and platinum, also inched lower, while copper prices were subdued by a strong dollar, despite China’s factory activity expanding for a third straight month.
The London Metal Exchange’s benchmark copper price inched 0.2% lower to $8,925.50 a ton, while February copper was largely unchanged at $4.0885 a pound.
