Gold eases as spotlight turns to Fedspeak for interest rate cues

Nov 6 – Gold eased on Monday as US Treasury yields rose, with investors remaining cautious as they gear up for a host of Federal Reserve speakers this week including Jerome Powell for clarity on US rate cuts.

Spot gold fell 0.7% to USD 1,979.19 per ounce by 2:41 p.m. ET (1941 GMT) after rising above the key USD 2,000 level on Friday. US gold futures settled 0.5% lower at USD 1,988.60.

Risk appetite is a bit better and there have been no major surprise developments from the Israel-Hammas war, and this is taking away a little bit of the safe-haven bidding for gold and silver, said Jim Wyckoff, senior analyst at Kitco Metals.

Bullion gained over 7% in October as the Middle East conflict boosted safe-haven demand.

Wall Street’s main indexes turned negative after inching up earlier, while Benchmark 10-year US Treasury yields rose, as investors kept their eyes peeled for at least nine Fed members speaking this week, including Powell on Nov. 9.

Traders are pricing in a 90% chance the Fed will leave rates unchanged in December, according to the CME FedWatch tool.

“Gold and silver market bulls have a little bit of ammunition as the expectation is that there will be no further rate hikes, which is pressuring the US dollar,” added Wyckoff.

Gold is sensitive to rising US interest rates, as they increase the opportunity cost of holding the non-yielding asset.

For gold to sustainably move above USD 2,000/oz, it may need a clearer signal from the Fed that cuts are coming, and the return of investors to ETFs (exchange-traded-funds), Heraeus Metals wrote in a note.

Speculators raised their net long positions in COMEX gold futures by 15,661 contracts to 106,343 in the week ended Oct. 31, CFTC data showed on Friday.

Silver was down 0.6% to USD 23.05 per ounce.

Platinum shed 2.5% to USD 906.86, and palladium fell 1.9% to USD 1,098.54, both eyeing their biggest daily declines since October.

(Reporting by Ashitha Shivaprasad and Anushree Mukherjee in Bengaluru; Editing by Krishna Chandra Eluri)