Gold Falls to Four-Week Low and Copper Sags Ahead of Fed Meeting
(Bloomberg) -- Gold slid to the lowest in almost a month as a U.S. bond rally lost steam ahead of this week’s Federal Reserve meeting, which may give clues on future monetary policy. Copper also fell.
Bullion retreated as Treasury yields ticked higher, curbing the appeal of the non-interest-bearing metal. Bullion has posted two straight weekly declines.
Economic stimulus and low interest rates have helped boost precious and base metals this year, and investors are wary that economic growth and inflation will spur the Fed to pull back support. Money managers pared long positions in gold and copper last week, U.S. data showed Friday.
Spot gold fell 0.7% to $1,864.49 an ounce at 1:24 p.m. in New York after sliding as much as 1.7%. Futures for August delivery on the Comex dropped 0.7% to settle at $1,865.90. Silver was little-changed, while platinum rose and palladium fell. Copper for three-month delivery on the London Metal Exchange slipped 0.3% to settle at $9,971.50 a metric ton.
If Fed Chair Jerome Powell sticks with the central bank’s current stance of transitory price increases and no pullback in stimulus at his press conference on Wednesday, gold should be able to regain the ground it has lost, Commerzbank AG analyst Carsten Fritsch said in a note.
Last week, gold struggled to make gains past $1,900, which may have resulted in pressure from technical traders, said ABN Amro Bank NV strategist Georgette Boele. Monday’s drop also took prices out of an uptrend seen since early April.
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