Gold extends fall as investors book profits

Gold prices fell to a near two-week low, following their sharpest single-day drop in five years in the previous session, as investors booked profits ahead of key U.S. inflation data due this week.

Spot gold was down 1.7% at $4,054.34 per ounce, as of 01:42 p.m. ET (1742 GMT), after rising to as much as $4,161.17 earlier in the session.

US gold futures for December settled 1.1% lower at $4,065.40 per ounce.

Gold prices have notched multiple record highs and gained 57% this year, bolstered by geopolitical tensions, economic uncertainty, expectations of US rate cuts, and strong inflows into ETFs. Prices fell 5.3% on Tuesday, after notching a record high of $4,381.21 in the preceding session.

“Given the aggressive move to the upside over the course of the last several weeks, it’s not completely surprising to us to see a bit of profit taking ahead of the CPI report on Friday,” said David Meger, director of metals trading at High Ridge Futures.

On the technical front, gold is supported by the 21-day moving average at $4,005.

Friday’s US Consumer Price Index (CPI) report, delayed due to the ongoing US government shutdown, is expected to show that core inflation held at 3.1% in September.

Investors have nearly fully priced in a 25-basis-point rate cut at the US Federal Reserve’s meeting next week.
Gold, a non-yielding asset, tends to benefit in low-interest-rate environments.

Among other metals, spot silver dropped 1.6% to $47.95 per ounce. It slipped 7.1% on Tuesday.

Platinum gained 4.5% to $1,620.83, while palladium rose 0.1% to $1,409.80.