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Gold drops from two-week high

November 21, 2023 00:00:00

Gold prices on Monday slipped from their two-week highs hit in the last session, as US Treasury yields bounced back, with investors looking forward to the minutes of Federal Reserve's last meeting to gauge the US central bank's policy stance.

Spot gold was down 0.4 per cent at $1,972.26 0 per ounce as of 1146 GMT, after rising as high as $1,993.29 on Friday. U.S. gold futures fell 0.5 per cent to $1,974.60.

"Gold bulls are taking a breather after climbing by over 2 per cent last week... There could also be more geopolitical risk premiums that have yet to be unwound from spot gold prices," said Exinity Chief Market Analyst Han Tan.

"Traders appear to be waiting for the outcome of today's 20-year US Treasury auction before deciding whether or not to extend gold's gains from last week," said Tan.

The minutes of the Fed meeting will be released on Tuesday.

Last week's data reignited hopes that the Fed could begin easing monetary conditions sooner than expected after a slowing jobs market report in the US and a weaker-than-expected consumer inflation report.

Lower interest rates boost non-yielding bullion's appeal.

"On the flip side, seeing a fairly significant divergence in terms of where gold is trading at the moment with real yields... we're going to need much weaker data from here to really kind of catalyze that move above $2,000 per ounce," said Kyle Rodda, a financial market analyst at Capital.com.

The dollar slipped 0.3 per cent to a more than a 2-1/2-month low against its rivals, limiting gold's losses today.

Holdings of SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, rose 1.5 per cent on Friday.

Elsewhere, spot silver slipped 1.2 per cent to $23.44 per ounce, platinum lost 0.2 per cent to $897.07 and palladium was steady at $1,052.64 per ounce.

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