Gold prices fell at the beginning of the last month of 2024, falling slightly, weighed down by the strength of the US dollar supported by Trump’s harsh rhetoric regarding the BRICS countries and some easing of geopolitical tensions. Gold is trading at $2,635, down 0.58%.
The gold metal extended its losses after Trump warned the BRICS countries that moving away from the dollar could see them face 100% tariffs “and you should expect a sell-off in the wonderful US economy,” he added.
Once Monday’s session began, gold fell to a daily low of $2,621 before regaining some ground, but rising US Treasury yields and the US Dollar Index (DXY) limited gold’s advance.
In terms of data, the US economic agenda included the release of the November ISM Manufacturing PMI, which rose to its highest reading since June.
Earlier, Standard & Poor’s Global announced that manufacturing activity in the United States improved, indicating that the economy remains strong.
Following the data, the Atlanta Fed’s GDP for Q4 2024 has now risen from 2.69% to 3.16% following the release of the Institute for Supply Management data.
Atlanta Fed President Rafael Boucek made the announcement stating that he is not sure whether a cut this month is necessary, but he believes interest rates should continue to fall over the following months.
He said prices should be at a reasonable level that “neither stimulates nor restricts economic activity,” adding that he is keeping his options open.
Meanwhile, the CME FedWatch tool shows the odds of a 25 basis point rate cut at 63%, down from 66% last Friday and this suggests the December 17-18 meeting will be live.
This week, the US economic agenda will include speakers from the Federal Reserve, including Fed Chair Jerome Powell, October jobs, services PMI surveys from Standard & Poor’s and the Institute for Supply Management, and non-farm payrolls numbers.
