Gold prices slipped in Asian trading on Thursday. The decline came as some traders took profits, even though confidence grew that the Federal Reserve will cut interest rates next week.
Spot gold fell 0.3% to $4,191.55 an ounce by 02:28 ET (07:28 GMT). U.S. gold futures for February delivery also dropped 0.3% to $4,219.46.
U.S. data boosts expectations of Fed easing
The pullback in gold came despite markets pricing in almost a 90% chance of a 25-basis-point rate cut at the Fed’s December 9–10 meeting, according to the CME FedWatch tool.
Recent U.S. data supported those expectations. Private payrolls fell by 32,000 in November, according to the ADP employment report. This marked a sharp reversal from October’s revised 47,000-job gain and missed forecasts for growth.
The ISM services index showed modest expansion in November. However, underlying components pointed to cooling momentum in the sector.
Investors now await the delayed September Personal Consumption Expenditures (PCE) Price Index, the Fed’s preferred inflation measure. The report, due Friday, is expected to offer clearer guidance on how aggressive the upcoming rate cut might be.
Adding to the market’s uncertainty are media reports that the Trump administration abruptly cancelled interviews with several candidates to replace Jerome Powell. This has intensified speculation that Kevin Hassett could become the next Fed chair.
Expectations of a more dovish Federal Reserve under new leadership have strengthened demand for non-yielding assets such as gold.
Metals trade lower ahead of Fed decision
Other precious and industrial metals also moved lower as traders reduced exposure ahead of next week’s policy meeting.
Silver futures declined 1% to $58.00 per ounce. Platinum futures dropped 1.3% to $1,661.60 per ounce.
On the London Metal Exchange, benchmark copper futures slipped 0.2% to $11,455.26 a ton. U.S. copper futures were steady at $5.39 a pound.
