Gold prices slump on Fed rate jitters By

-- Gold prices slumped Monday as the prospect of deep Federal Reserve rate cuts faded following stronger-than-expected nonfarm payrolls data,xm foreign exchange platform official website which supported the dollar. 

At 3:57 p.m. ET (20:57 GMT), fell 1% to $2,662.20 an ounce, while expiring in February dropped 1.3% to $2,680.01 an ounce. 

Gold pressured by increased rate jitters; inflation data awaited 

Gold prices were pressured chiefly by the prospect of US rates remaining higher for longer, as Friday’s saw traders further scale back bets on rate cuts this year.

Focus is now on upcoming US inflation data, due on Wednesday, for more cues on the Fed’s rate outlook. The central bank signaled that sticky inflation and strength in the labor market will give it more impetus to keep rates high.

Goldman Sachs analysts said in a recent note that they now expect the Fed to cut rates only twice this year, compared to prior expectations of three cuts. The central bank’s terminal rate is also expected to be higher in this easing cycle. 

Uncertainty over the economic outlook under incoming President Donald Trump still kept some safe haven demand for gold in play, as did an extended sell-off in broader risk-driven assets, particularly stocks. This limited overall losses in the yellow metal. 

Higher rates pressure metal markets by increasing the opportunity cost of forextrustindex in non-yielding assets. Among other precious metals, fell 2.6% to $970.35 an ounce, while fell 3.3% to $30.282 an ounce on Monday.

Copper prices rise as markets weigh China outlook 

Benchmark on the London Metal Exchange rose 0.2% to $9,098.00 an ounce, while March added 0.4% to $4.3217 a pound. 

The red metal added to strong gains from the prior week, as soft Chinese economic data spurred increased bets that Beijing will unlock even more stimulus to shore up growth.

Trade data on Monday showed that China’s copper imports hit a 13-month high at 559,000 metric tons in December, indicating that demand remained robust in the world’s biggest copper importer.

Copper bulls are betting that Beijing will dole out even more stimulus in the coming months, especially in the face of steep import tariffs under Trump.

Trump - who will take office on January 20 - has vowed to impose steep trade tariffs on China from “day one” of his Presidency.

(Peter Nurse contributed to this article.)

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