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Gold prices slipped slightly in Asian trade on Thursday, extending the losses from the previous session, triggered by a sharp rally in the dollar and risk assets following Donald Trump’s victory in the 2024 U.S. presidential election. Despite this recent decline, gold has managed to hold on to significant gains accumulated over the past month, thanks to the heightened uncertainty leading up to the election.
Gold Weakens as Dollar Strengthens
Spot gold edged down to $2,658.03 an ounce, while December gold futures dropped 0.4% to $2,664.70 an ounce as of 23:37 ET (04:37 GMT). Wednesday’s sell-off saw gold plummet over 3%, driven by the dollar’s rally to a four-month high. This reaction reflects a shift in investor sentiment as a quick resolution to the election and Trump’s victory reduced market uncertainty, prompting a move away from safe-haven assets like gold.
While the initial shockwave has settled somewhat, ongoing concerns are keeping gold from sliding further. Uncertainty surrounds Trump’s cabinet picks and his aggressive stance toward China, with promises of high tariffs potentially reigniting trade tensions. Moreover, Trump’s anticipated inflationary policies, which may keep pressure on interest rates, could continue to weigh on non-yielding assets like gold.
All eyes are now on the Federal Reserve’s upcoming meeting, where a 25-basis-point rate cut is widely expected. However, market participants remain cautious, awaiting further guidance from the Fed on its plans for future rate adjustments, especially in light of Trump’s economic policies and persistent inflation pressures.
Pressure on Other Precious Metals
The broader precious metals market also saw declines. Platinum futures fell 0.6% to $988.40 an ounce, while silver futures dropped 0.9% to $31.035 an ounce. Both metals are experiencing a downturn, following steep losses in recent trading sessions.
Copper Rebounds Amid Steady Chinese Demand
In contrast to the precious metals sector, industrial metals like copper showed signs of recovery. Copper prices gained on Thursday, supported by steady demand data from China. Benchmark copper futures on the London Metal Exchange rose 1.3% to $9,444.50 a ton, while December copper futures increased by 1.4% to $4.2980 a pound.
These gains come after substantial losses on Wednesday, when copper prices tumbled between 4% and 5% due to fears that a Trump presidency could exacerbate economic headwinds for China. As the world’s largest copper importer, China’s demand is a key driver for copper prices. Thursday’s trade data revealed that China imported 506,000 metric tons of unwrought copper and copper products in October, marking a 1.1% increase year-on-year, which helped lift sentiment in the copper market.
