Investing.com said gold prices were under pressure as the market focused on Powell’s speech.

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Investing.com – Gold prices traded modestly higher in Asian trading on Wednesday, but have fallen sharply over the past two sessions as hawkish comments from Federal Reserve officials kept traders on the sidelines. Reconsider expectations for more rate hikes.

That puts the spotlight on upcoming remarks from Federal Reserve Chairman Jerome Powell, after markets viewed his remarks at last week’s meeting as toned down.

Gold has seen some gains over the past week following the Federal Reserve meeting, and weaker-than-expected data raised hopes that the central bank’s rate hike cycle is over.

However, some Fed officials have played down expectations of a pause in rate hikes, saying higher rates are needed amid a strong economy and tough inflation.

This weakens gold’s prospects as higher interest rates reduce the opportunity cost of investing in gold.

It fell 0.1% to $1,967.78 an ounce, while it was unchanged at $1,973.85 an ounce at 11:33pm ET (04:33GMT) on December expiry.

Powell’s speech focuses on Fed officials shortening pause on bets

Twice this week, once on Wednesday and once on Thursday. Any further comments on the US economy and monetary policy will be in focus, especially after October’s non-farm payrolls report was weaker than expected.

But before Powell, several Fed officials, including Governor Michelle Bowman, Minneapolis Fed President Nir Kashkari and Chicago Fed President Austen Goolsby, noted that inflation remains Too high, and interest rates may rise further in the coming months.

Even if the Fed pauses its interest rate cuts, it is expected to begin cutting interest rates in mid-2024, limiting gold’s recent sharp gains.

The central bank said U.S. interest rates will remain elevated and could remain above 5% for longer until the end of 2024. This situation does not bode well for gold next time around.

In the context of the market’s concerns about the conflict between Israel and Hamas easing, the safe-haven demand for gold has also gradually decreased.

Among industrial metals, copper prices edged lower on Wednesday, extending recent losses after weak economic data from China heightened concerns about the world’s largest copper importer.

Prices for December expiration fell 0.1% to $3.6822 per pound.

After a largely disappointing market in China on Tuesday, focus is now on whether the country shows any signs of a rebound in spending by Thursday’s deadline.

Copper investors breathed a sigh of relief after reports that Chinese regulators have met with several major domestic property developers to assess their financial health, potentially signaling more policy support for the industry.

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