Gold falls to one-month low on Powell's hawkish remarks
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ScrapPrices
Published on December 02,2021 10:00 AM Metals
Gold struck a one-month low on Thursday as U.S. Federal Reserve Chairman Jerome Powell's comments on the need to tame inflation bolstered bets for faster monetary policy tightening and offset Omicron-driven safe-haven inflows into bullion.
Gold falls to one-month low on Powell's hawkish remarks

Dec 2 (Reuters) - Gold struck a one-month low on Thursday as U.S. Federal Reserve Chairman Jerome Powell's comments on the need to tame inflation bolstered bets for faster monetary policy tightening and offset Omicron-driven safe-haven inflows into bullion.

Spot gold was last down 0.2% at $1,778.81 per ounce by 1304 GMT, having earlier hit its lowest since Nov. 3.

U.S. gold futures dropped 0.1% to $1,782.50.

In his second day of testimony in Congress on Wednesday, Powell said the Fed needed to be ready to respond to the possibility that inflation might not recede in the second half of 2022 and the central bank would consider a faster tapering of its bond purchases at its meeting this month. read more

A faster wind-down of the bond-buying program is widely seen as opening the door to earlier interest rates hikes, which would raise the opportunity cost of holding non-yielding gold.

The prospect of a faster taper could cap the upside for bullion and boost the U.S. dollar and Treasury yields, in a further dent to gold's appeal, said Michael Hewson, chief market analyst at CMC Markets UK.

Investors now await the U.S. jobs report for November due later this week. Data on Wednesday showed private payrolls increased by 534,000 jobs last month. read more

"A decent set of jobs numbers also has the potential to push gold lower, towards $1,740, but overall bullion remains in a range, capped around $1,810 and support at $1,740," Hewson said.

Gold's losses were capped by worries about the Omicron coronavirus variant, which has forced countries around the globe to plan stricter restrictions. read more

Spot silver rose 0.7% to $22.46 per ounce and platinum gained 1.2% to $944.54.

The World Platinum Investment Council said the global platinum market would see a much larger surplus this year than it previously forecast and another big oversupply in 2022. read more

Palladium fell 0.3% to $1,741.35 per ounce.

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