Gold prices fell amid rate uncertainty; copper slips as China cheer fades By Investing.com

Investing.com– Gold prices were little moved in Asian trade on Tuesday, easing after retreating from record highs, as traders priced in the prospect of fewer interest rate cuts by the Federal Reserve.

Among industrial metals, copper prices fell sharply as Chinese markets reopened after a week-long holiday, while Beijing’s plans to implement recently announced stimulus measures were disappointed.

This week has focused on several indications from the Fed, as well as key inflation data, which will likely weigh on the outlook for rates.

Gold prices rose to record highs in September after the Fed cut rates by 50 basis points and launched an easing cycle. But doubts about the central bank’s future pace of interest rate cuts led the yellow metal to retreat.

The dollar’s strength – which hit seven-week highs in recent sessions – also weighed on metals markets.

settled at $2,642.86 an ounce, while December expiry was down 0.2% at $2,661.70 an ounce.

Gold nurses fall from record highs; more rate indications expected

The yellow metal has sunk from record highs in the past week, now turning to more interest rate cues.

Most of gold’s losses came after stronger-than-expected data on Friday saw traders sharply cut expectations for future interest rate cuts.

Traders were expecting about an 81% chance of a 25bps cut in November and a 19% chance of a 19% cut.

This week focused on the minutes of the Fed’s September meeting for more information on its outlook for future rate cuts, with the bank largely forecasting a data-driven approach.

Data due later this week will provide more clues on inflation, taking into account the Fed’s outlook.

While lower interest rates bode well for metals markets, a slower pace of discounting makes non-yielding assets look less attractive in the near term.

Prices of other precious metals also fell on Tuesday. was down 0.8% at $977.50 an ounce, while it was down 1.1% at $31.660 an ounce.

Copper slips as China’s stimulus wears thin

Among industrial metals, copper prices fell sharply on Tuesday after markets in mainland China opened after a week-long holiday.

The London Metal Exchange benchmark fell 1.5 percent to $9,800.50 a tonne, while on the month it fell 1.9 percent to $4.4697 a pound.

Copper initially benefited from optimism about China after Beijing announced a series of major stimulus measures in late September. China is the largest importer of copper in the world.

But that momentum fizzled on Tuesday, especially as the Chinese government offered disappointing plans on how it plans to implement the stimulus measures.