Gold prices struggled for momentum on Thursday, as dollar firmed after Donald Trump’s election victory, while investors shifted focus to the Federal Reserve’s upcoming rate cut decision.

Gold retreats as dollar surges on Trump victory

Fundamentals

• Spot gold was little changed at $2,663.02 per ounce, as of 0018 GMT. It hit a record high of $2,790.15 last week and has lost nearly $130 since then.

• US gold futures edged 0.2% lower to $2,670.40.

• Bullion slipped to over 3-week low in previous session, as investors piled into the US dollar after Republican Donald Trump was elected US president.

• The dollar index hit a four-month high in the last session, making bullion more expensive for overseas buyers. * Trump beat Democrat Vice President Kamala Harris to retake the White House while Republicans also won a US Senate majority.

• With Trump coming back to power Fed rate cuts may slow down, with his policies expected to boost the economy and curb inflation.

• Traders await the expected 25-basis-point cut, likely to be announced at the end of the Fed’s two-day meeting later in the day.

• Investors will also seek hints on the further Fed’s rate-cut path during Fed Chair Powell’s press conference at 1930 GMT.

• Bullion is considered a hedge against geopolitical and economic uncertainties and tends to thrive in low-interest-rate environment.

• SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, said its holdings fell 0.39% to 883.46 tonnes on Wednesday.

• Overall, metals bore the brunt of global commodity price losses after a US election win by Donald Trump on Wednesday, while oil, gas and agricultural commodity prices recouped some losses.

• Spot silver rose 0.2% to $31.21 per ounce, platinum gained 0.13% to $987.90 and palladium was down 0.2% to $1,032.93.