Gold Dips Below $4,000 After Fed Officials Push Back on Rate Cut Expectations

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Summary:

Gold prices slipped below $4,000 per ounce as three top Federal Reserve officials signaled caution about cutting interest rates in December....

Fed Officials Shift Tone – Gold Feels the Pressure

In early trading on November 4 (Vietnam time), spot gold fell 0.5% to $3,981.86/ounce. The drop followed cautious remarks from three key members of the U.S. Federal Reserve: Governor Lisa Cook, San Francisco Fed President Mary Daly, and Chicago Fed President Austan Goolsbee.

While Governor Cook acknowledged signs of labor market weakness, she refrained from supporting a rate cut in the upcoming December meeting. Her stance echoed earlier statements from Daly and Goolsbee, signaling that the Fed may be moving to tone down market expectations of continued monetary easing.

Rising Yields and a Stronger Dollar Undermine Gold’s Rally

These remarks prompted investors to reassess their expectations for U.S. interest rates, pushing bond yields higher and strengthening the U.S. dollar—both of which typically weigh on gold prices, which pay no yield and are priced in dollars.

Kyle Rodda, analyst at Capital.com, noted that the Fed could be actively trying to cool off rate cut speculation to avoid excessive market optimism, which could pose financial risks if reversed suddenly.

Gold Retreats After October Peak

Gold prices had previously surged to a record high in mid-October, driven by aggressive buying amid geopolitical uncertainty and rate cut hopes. However, the recent retreat reflects growing doubts about whether that bullish trend can resume, especially as gold’s performance remains tightly tied to the Fed’s monetary policy stance.

Fed Chair Jerome Powell also warned last week that investors shouldn’t assume another rate cut is guaranteed in December, further reinforcing the central bank’s message of caution. As a result, traders are now recalibrating their strategies as gold's path forward hinges more than ever on Fed signals.

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