Gold retreats from record highs as interest rate cut forecasts fade

Gold retreats from record highs as interest rate cut forecasts fade
Gold retreats from record highs as interest rate cut forecasts fade

The price of gold remained sluggish on Thursday, after a recent rally that petered out and fell more than 1% in the previous session, as traders began to reduce their rate cut forecasts by the US Federal Reserve this year.

FUNDAMENTALS

* Spot gold held steady at $2,377.48 an ounce, as of 0113 GMT. Bullion hit a record high of 2,449.89 on Monday.

* US gold futures fell 0.6% to $2,378.20.

* Federal Reserve officials indicated it would take longer than expected to be more confident in inflation moving toward 2%, according to minutes of the U.S. central bank’s April 30-1 session. may.

* Recent data suggests that U.S. inflation has resumed its downward trend, but several Fed policymakers remained cautious about cutting rates too soon, while ruling out the need for an increase.

* Traders’ bets showed growing doubt that the Fed will cut rates more than once in 2024.

* Bullion is known to be a hedge against inflation, but rising rates increase the opportunity cost of holding non-interest-bearing gold.

* Goldman Sachs CEO David Solomon said he does not expect the Federal Reserve to cut interest rates this year.

* Asian markets could be tricky to open, with growing concerns over the speed of falling US and global interest rates being offset by a potential boost from AI and results from the manufacturing giant Nvidia chips, late Wednesday afternoon.

* Shares in global mining group BHP fell more than 3%, a day after smaller rival Anglo American rejected its third takeover proposal and agreed to a one-week extension of the deadline to make an offer farm.

* Spot silver fell 0.7% to $30.56 an ounce, platinum fell 0.4% to $1,031.04 and palladium lost 1.5% to 985.00 dollars.

DATA/EVENTS (GMT) 0500 Japan Chain Store Sales YY April 0715 France HCOB Mfg, Serv, Comp Flash PMIs May 0730 Germany HCOB Mfg, Serv, Comp Flash PMIs May 0800 EU HCOB Mfg, Serv, Comp Flash PMIs May 0830 UK Flash Comp , Mfg, Serv PMIs May 1230 US Initial Jobless Clm Weekly 1445 US S&P Global Mfg, Svcs, Comp Flash PMIs May 1400 EU Consumer Confid. Flash May 1400 US New Home Sales-Units April G7 finance ministers and central bank governors meet in Stresa, Italy, to discuss developments in the global economy (reporting by Sherin Elizabeth Varghese in Bengaluru; writing by Sherry Jacob-Phillips)

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