Investing.com-- Gold prices fell slightly Monday, coming under pressure from a stronger dollar as expectations of a slower pace of monetary easing kept traders largely biased towards the greenback.
At 13:30 (18:30 GMT), Spot gold fell 0.04% to $2,637.95 an ounce, while gold futures expiring in February fell 0.2% to $2,648.86 an ounce.
The yellow metal has been steadily losing ground since late-December, after the Federal Reserve warned that it will cut interest rates at a slower pace in 2025. The dollar’s recent rally was sparked largely by this notion.
Hawkish comments from some Fed officials over the weekend also pressured gold.
Hawkish Fedspeak dents gold, boosts dollar
Losses in gold and strength in the dollar came after two Fed officials warned that the bank’s fight against inflation was not over, potentially heralding a more hawkish outlook for interest rates.
Separately, on Monday Fed Governor Lisa Cook said the U.S. Federal Reserve could adopt a cautious approach towards further interest rate cuts.
The greenback steadied in Asian trade after racing to its strongest level since November 2022.
Governor Adriana Kugler and San Francisco Fed President Mary Daly both said that the central bank was still not declaring victory over inflation, and was closely watching the labor market for any signs of weakness.
Sticky inflation and a strong labor market give the Fed less impetus to cut interest rates. Focus this week is on upcoming nonfarm payrolls data for more cues on interest rates.
Other precious metals were mixed on Monday. Platinum futures fell 0.5% to $943.10 an ounce, while silver futures rose 1.5% to $30.515 an ounce.
Among industrial metals, March copper futures rose 2% to $4.1547 a pound, with the focus turning to upcoming inflation data this week for more cues on the world’s biggest copper importer.
Goldman Sachs (NYSE:GS) pushes forward $3,000/oz gold price forecast
Goldman Sachs on Monday said it now expects gold prices to hit $3,000 an ounce by mid-2026, after the yellow metal did not hit the price target by end-2024.
The investment bank expects gold to end 2025 at around $2,900 an ounce, and expects $3,000 to come later amid slower interest rate cuts by the Fed.
Gold prices gained about 27% in 2024, as they benefited from the Fed cutting interest rates by 1% in the second half of the year.
The yellow metal also saw robust safe-haven demand amid heightened geopolitical tensions in the Middle East and Russia.
But gold lost ground towards the end of the year, pressured by a more hawkish Fed outlook for 2025.
(Peter Nurse contributed to this article.)