Investing.com -- Gold prices moved little on Monday as markets awaited a string of Federal Reserve speakers and testimonies this week for more cues on monetary policy, while copper retreated as investors sold off recent profits.
Trading volumes in metal markets are expected to be thin on Monday, on account of a U.S. market holiday, while anticipation of a testimony by Fed officials, most notably Chair Jerome Powell later this week, is also expected to deter big bets.
Spot gold was flat at $1,957.88 an ounce, while gold futures fell 0.1% to $1,971.20 an ounce by 21:05 ET (01:05 GMT).
Both contracts stuck to a tight trading range seen over the past month amid mixed cues on the path of U.S. monetary policy, which has largely determined the trajectory of gold over the past year.
While the Fed paused its rate hike cycle for the first time in over a year last week, the bank still warned of the possibility of at least two more hikes this year, dimming the prospect of a recovery in gold prices.
Higher interest rates weigh on gold prices by pushing up the opportunity cost of holding non-yielding assets. While the dollar still dropped after the Fed decision last week, gold saw limited support.
Markets are now pricing in a 25 basis point hike by the Fed in July, given that inflation is still trending well above the central bank’s 2% annual target.
A testimony before Congress by Fed Chair Powell on Wednesday is expected to provide more cues on monetary policy, while several more Fed officials are also due to speak during the week.
Copper prices retreated on Monday following three weeks of strong growth, as traders locked in some recent profits. But questions over an economic recovery in China also weighed on markets.
Copper futures fell 0.5% to $3.8753 a pound, after rising as much as 5% over the past three weeks. A bulk of this rebound was driven by traders buying into copper after prices sank to six-month lows in May.
Concerns over Chinese demand persisted, as a slew of major investment banks slashed their gross domestic product forecasts for the country, citing a slower-than-expected economic recovery despite the lifting of anti-COVID measures earlier this year.
Begin trading today! Create an account by completing our form
At One Financial Markets we are committed to safeguarding your privacy.
Please see our Privacy Policy for details about what information is collected from you and why it is collected. We do not sell your information or use it other than as described in the Policy.
Please note that it is in our legitimate business interest to send you certain marketing emails from time to time. However, if you would prefer not to receive these you can opt-out by ticking the box below.
Alternatively, you can use the unsubscribe link at the bottom of the Demo account confirmation email or any subsequent emails we send.
By completing the form and downloading the platform you agree with the use of your personal information as detailed in the Policy.