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Gold slips, pauses longest winning streak since 2014

Published: Jan 4, 2018 7:09 a.m. ET

Silver futures drop, copper tips higher

Gold prices slipped Thursday, snapping a nine-session run that had been longest winning streak for the metal’s futures market in nearly three years.

February gold GCG8, -0.33% was off $3.80, or 0.3%, to $1,314.70 an ounce, a reversal that began in Wednesday’s after-hours following the release of Federal Reserve meeting minutes. Futures prices logged their highest settlement since Sept. 15, at $1,318.50, on Wednesday. The ninth-consecutive session of gains was the longest such streak of gains since February 2014.

The exchange-traded SPDR Gold Trust GLD, -0.26% slipped 0.2% premarket Thursday, while the VanEck Vectors Gold Miners ETF GDX, -1.05% was down 0.3%.

Gold paused its rally even as the ICE U.S. Dollar Index DXY, -0.31% fell 0.3% to trade back at its lowest in about three months.

Gold prices had turned south in electronic trading Wednesday after the release of minutes from the U.S. Federal Reserve’s December monetary policy meeting, which revealed a sharp divide among officials over the central bank’s forecast for three interest-rate hikes this year. According to the CME Group’s data, the market is currently pricing in the next rate rise in March.

“With the composition of the [Fed policy panel] changing over the coming months, it’s difficult to take too much of value away from the minutes, particularly when members acknowledge that the economic benefit of the tax cuts is unknown, with a number of people outside the central bank arguing that it will be small and short-lived,” said Craig Erlam, senior market analyst at Oanda.

Expectations of higher U.S. interest rates later this year and the passage of the Republican tax bill have failed to give the dollar a lift, helping gold, in part because traders wonder how much the tax reforms will actually boost the economy. A weaker dollar tends to provide a boost to dollar-pegged commodities, including gold, making them more attractive to users of weaker monetary units.

Read: 7 reasons why investors should go for gold in 2018

Geopolitical concerns have helped to support the haven precious metals. Antigovernment protests in Iran over the past week have been partly driven by economic grievances after the lifting of international sanctions that did not generate the expected windfall. Some foreign leaders, including U.S. President Donald Trump, have been critical of how Iran has used money on foreign conflicts, another focal point of protester anger and enough to drive oil prices to roughly three-year highs.

Other metals trading was mixed. March copper HGH8, +0.91% rose 1% to $3.2900 a pound and March silver SIH8, -0.56% fell 0.5% to $17.185 an ounce.

March palladium PAH8, +1.22% rose 1.2% to $1,096.85 an ounce after a rise of more than 50% for futures prices in 2017. April platinum PLJ8, -0.50% fell 0.4% to $958.10 an ounce.

https://www.marketwatch.com/story/gold-slips-pauses-longest-winning-streak-since-2014-2018-01-04?siteid=rss&rss=1