Gold and silver ended lower on Monday, easing back after both metals posted two consecutive weekly gains, as investors bid up the U.S. dollar in anticipation of a September inflation report due out later in the week.
Gold for December delivery
fell $34.10, or 2%, to settle at $1,675.20 per ounce on Comex. That was the lowest most-active contract settlement month to date, FactSet data show.
shed 64 cents, or 3.2%, to $19.615 per ounce, the lowest finish since Sept. 30.
December copper futures
gained 4 cents, or 1.3%, to settle at $3.4305 per pound.
What analysts are saying
Prices of gold and silver moved lower yet again as precious-metals traders anticipate that the U.S. inflation data set for release on Thursday could increase the pressure on the Federal Reserve to continue hiking interest rates aggressively — potentially delivering another 75 basis point rate hike at the central bank’s November meeting.
“The broader outlook for gold remains one where central banks across the world look set on a course of a series of interest rate hikes to try and bring stubbornly high inflation back down towards their target figures,” said Rupert Rowling, a market analyst at Kinesis Metals, in a note to clients.
“The impact of these ever increasing rates has been to make gold a less desirable commodity to hold with its lack of yield making other interest-paying assets such as bonds more attractive in its place.”
The consumer-price index for September is due out on Thursday. Economists polled by FactSet expect the annualized inflation rate will slow to 8.1% from 8.3% last month, while the month-over-month rate is expected to accelerate to 0.2% from 0.1% in August.
Gold’s price decline on the back of a “resurgent greenback and dwindling faith in slower monetary tightening,” has far outweighed the modest rally in the dollar at the start of the week, said Craig Erlam, senior market analyst at OANDA, in market commentary.
The ICE U.S. Dollar Index
a gauge of the dollar’s strength against a basket of rivals, rose 0.2% to 113.04.
The Treasury market was closed for Columbus Day, a federal holiday that also has been recognized as Indigenous Peoples’ Day.