Gold prices remain stable, expectations of U.S. dollar interest rate hikes have cooled, but gold prices still face selling pressure

Gold prices remained stable on Tuesday (5th). (Bloomberg file photo)

[Financial Channel/Comprehensive Report] The price of gold remained stable on Tuesday (5th). Although the probability of the Federal Reserve (Fed) raising interest rates this month has decreased, the appreciation of the U.S. dollar and high U.S. bond yields have still put gold under heavy selling pressure. Precious Metals Consulting predicts that gold will have the opportunity to hit a record high in 2027, with gold prices averaging $5,330 per ounce next year.

Spot gold rose 0.1% to $4,139.89 an ounce.

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U.S. gold futures fell 0.1% to $4,156.80 an ounce.

"We may see a short-term decline (in gold prices) before buying comes in force, all tied to the continued strength of the U.S. dollar and high yields," said Fawad Razaqzada, market analyst at FOREX.com.

"Most of the U.S. economic data released in recent days have been worse than expected, which has led to market bets on interest rate hikes cooling down," Razakzada said.

Data showed that U.S. employment growth slowed more than expected in September, and non-farm payrolls data for the first two months were revised downwards, which has cooled market expectations for the Fed to raise interest rates this month.

Traders currently see a 22% chance of the Fed raising interest rates in October, down from about 70% last week. However, according to the CME Group's FedWatch tool, the market still believes that the chance of the Fed raising interest rates in December is as high as 84%.

Investors are awaiting the release of minutes from the September Federal Open Market Committee (FOMC) meeting later this week, which may help determine the direction of the Fed's future monetary policy. The Fed only raised interest rates last month for the first time in three years.

Metals Focus, a precious metals advisory firm, expects that investors seeking alternatives to traditional dollar-denominated assets will push gold to a record high in 2027, and predicts that gold prices will average $5,330 per ounce next year.

Other precious metals trading

Spot silver rose 1.2% to $61.09 an ounce.

Spot platinum rose 1.4% to $1,722.15 an ounce.

Spot palladium rose 0.7% to $1,176.33 an ounce.

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