Gold rebounds on flat dollar | Rare Coins, Gold & Silver for Discerning Collectors

Gold rebounds early Monday, rallying from last week’s selloff on a flat dollar, putting the yellow metal back above the $2600 an ounce benchmark. The bullion was also buoyed by bargain hunters buying the dip.

Investors are also watching for signals on the Federal Reserve’s next moves in light of the possibility that President-elect Donald Trump’s proposed tariffs and tax cuts could spur inflation again. The Fed has been widely expected to continue interest rate cuts into 2025 as inflation has slowed to near target levels.

Front-month gold futures fell 4.6% last week to settle at $2,570.10 an ounce on Comex after the most-active December contract slid 0.1% Friday. Bullion rose 3.4% in October after gaining 5.2% in September and advancing 2.2% in August. The metal is up 24% in 2024. The December contract is currently up $44.20 (+1.72%) an ounce to $2614.30 and the spot price is $2608.80.

Last week, Fed Chairman Jerome Powell said that the central bank doesn’t need to be “in a hurry” to cut interest rates because of strong economic growth.

A halt or delay in interest rates would be bearish for gold, which typically gets a boost from lower interest rates. Last week, two key measures of inflation, the consumer price index and the producer price index, came in this week in line with estimates for October. The Fed cut interest rates by a total of 75 basis points in September and November to 4.50% to 4.75%.

Most investors tracked by the CME FedWatch Tool are betting that the Fed will cut rates by another 25 basis points in December, ending the year at 4.25% to 4.50%. The rest expect the central bank to keep rates unchanged next month. Before the recent cuts, the Fed had kept rates at 5.25% to 5.50% for a year after raising them by 5.25 percentage points since March 2022. The central bank began raising rates during the pandemic to combat surging inflation.

Economic news out of the G20 summit in Brazil and comments from some Fed officials this week could influence markets. Additionally, University of Michigan consumer sentiment data comes out Friday.

Front-month silver futures lost 3.2% last week to $30.43 an ounce on Comex after the December contract decreased 0.3% Friday. Silver advanced 4.3% in October after rallying 7.9% in September and gaining 0.7% in August. It’s up 26% in 2024. The December contract is currently up $0.743 (+2.44%) an ounce to $31.175 and the spot price is $31.11.

Spot palladium fell 3.6% last week to $965.50 an ounce, though it rose 1.3% Friday. Palladium increased 11% in October after gaining 3.2% in September and rising 3.2% in August. Palladium is down 14% this year. The currrent DG spot price is up $43.70 an ounce to $1004.00.

Spot platinum dropped 2.9% last week to $947.90 an ounce, though it rose 0.5% Friday. Platinum rose 1.5% in October after increasing 5.6% in September and sliding 5.2% in August. Platinum is down 5% this year. The spot price is currently up $20.80 an ounce to $966.90.