Due to Fed rate reduction expectations, gold is steady around its seven-month top

 Due to Fed rate reduction expectations, gold is steady around its seven-month top

Due to Fed rate reduction expectations, gold is steady around its seven-month top

At 10:17 a.m. ET (15:17 GMT), spot gold was up 0.1% at $2,043.58 an ounce, having reached its highest level since May 5.

On November 29, gold reached its highest point in over seven months as the outlook for the zero-yield precious metal improved with predictions that the US Federal Reserve may lower interest rates by the first half of next year.

At 10:17 a.m. ET (15:17 GMT), spot gold was up 0.1% at $2,043.58 an ounce, having reached its highest level since May 5.

US gold futures increased to $2,044.90, up 0.3%.

David Megger, director of commodities trading at High Ridge Futures, said, "We anticipate there may be some pullback in gold next week, but in general, we're sanguine that this trend toward higher momentum will remain intact in the near future."

"As of right now, the consensus is that the Fed has raised interest rates and will continue to do so through 2024. The gold market will respond to data that confirms or refutes this view."

The demand for non-yielding gold is boosted by low rates.

Traders are now pricing in a more than 70% possibility of rates being lowered in May, up from 50% on Tuesday, according to CME's FedWatch tool.

On November 28, Fed Governor Christopher Waller hinted at the possibility of a rate reduction in the next months.

Although it had a 0.2% daily increase, the dollar index was expected to have its worst monthly performance in a year. For overseas customers, gold is less expensive due to a weak currency.

Standardization Gold was also aided by the two-month low that 10-year Treasury rates reached. [US] / [USD/]

On November 30, investors will keep an eye on US personal consumption expenditure (PCE) data, which is the Fed's favored measure of inflation, for more insights on the future for interest rates.

According to Ryan McIntyre, senior portfolio manager at Sprott Asset Management, investors in U.S. gold are expected to focus more on the status of the financial markets than on short-term economic, interest rate, and geopolitical worries.

Platinum dropped 0.8% to $932.78 while silver increased 0.6% to $25.14 per ounce. Palladium dropped 2.9% to an ounce for $1,023.84.