The U.S. dollar rose by 0.6% today, maintaining a position near two-year highs, which has contributed to a decline in gold prices. As of 10:05 a.m. ET, spot gold was priced at $2,612.58 per ounce, down 0.3%, while U.S. gold futures decreased by 0.7% to $2,627.60.
This movement comes as investors await clearer indications regarding the Federal Reserve's monetary policy for 2025. The Fed's recent decision to cut interest rates by 25 basis points, coupled with a signal for fewer reductions next year, has influenced market expectations.
Market analysts note that gold's appeal diminishes as the dollar strengthens, particularly for holders of other currencies. The benchmark U.S. 10-year Treasury yield has also risen, further impacting gold's attractiveness.
Despite recent declines, gold has experienced a robust performance this year, gaining approximately 27% overall, driven largely by strong central bank purchases and geopolitical tensions. Analysts suggest that the incoming presidency of Donald Trump may also add volatility to the markets, potentially benefiting gold prices.
In related movements, spot silver remained steady at $29.52 per ounce, while platinum and palladium experienced slight gains, trading at $939.05 and $927.74 respectively.