Gold tumbles in Asian trade as Fed cuts forecast

Gold prices in Asia took a tumble on Thursday, weighed down by the Federal Reserve‘s revised outlook for interest rates.

Spot gold dipped 0.7 per cent to $2,309.69 per ounce, while August gold futures plunged 1.2 per cent to $2,325.60 per ounce.

Investors reacted negatively to the Fed’s announcement that it now expects only one interest rate cut this year, down from prior projections of three.

Some policymakers even hinted at the possibility of no cuts at all, given persistent inflation.

The Fed’s hawkish stance impacted other precious metals as well. Platinum futures down 1.3 per cent to $951.55 per ounce, and silver futures dipped 3.3 per cent to $29.262 per ounce.

Industrial metals, including copper, also faced losses on Thursday due to a combination of factors:

• The prospect of prolonged high interest rates dampened the outlook for economic activity, leading to a decline in copper prices.
• Uncertainty surrounding further stimulus measures in China, a major copper importer, added to the downward pressure.
• Benchmark three-month copper futures on the London Metal Exchange fell 1.1 per cent to $9,837.50 a ton, while one-month copper futures dropped 0.5 per cent to $4.5095 per pound.

Attribution: Investing.com platform