Gold prices eased from record highs, while crude oil rose on Wednesday due to a decline in US stockpiles.
Gold remained above $3,800 per ounce on Wednesday as traders assessed the possibility of further rate cuts in the US.
Copper prices also slipped, and silver eased slightly as well.
Gold hovers around record highs
On Wednesday, gold prices remained stable, hovering near the previous day’s record high.
This was driven by anticipated US interest rate cuts and ongoing geopolitical uncertainty, both of which increased demand for the precious safe-haven metal.
The dollar index increased by approximately 0.5%, strengthening the greenback against other major currencies.
This rise makes dollar-denominated gold more costly for international buyers.
Speaking on Tuesday, Federal Reserve Chair Jerome Powell indicated that the central bank must continue to balance the persistent risks of high inflation against a softening job market when determining future interest rate policies.
This statement highlights an ongoing division among his colleagues regarding the most suitable policy direction.
The US dollar has ended a two-day losing streak, gaining momentum after Powell’s cautious statements on potential interest rate cuts.
At the time of writing, the December gold contract on COMEX was at $3,803.70 per ounce, down 0.3% from the previous close.
Silver falls
Silver prices also fell on Wednesday as the dollar rose against a basket of major currencies.
Silver prices on COMEX were at $44.638 per ounce, down 0.5%.
The precious metal has followed the rally of gold over the past few weeks, and prices have touched 14-year high.
The gold/silver ratio briefly fell below 85, its lowest level this year.
“The rally in precious metals has therefore been in progress for some time, leading analysts to consider that a top may be in for both metals,” said David Morrison, senior market analyst at Trade Nation.
But much will now depend on the nature of any pullback, should one emerge.
Given gold’s continued ascent, silver prices are also expected to climb, according to Commerzbank AG.
The only level surpassing the current 14-year high is the all-time peak of just under $50, last observed in late April 2011.
Oil rises
Oil prices climbed on Wednesday as an industry report indicated a drawdown in US crude inventories last week.
According to market sources citing API data, American Petroleum Institute figures revealed a decrease in US crude and gasoline stocks last week, while distillate stocks saw an increase.
Official government figures for crude oil stockpiles will be released by the US Energy Information Administration later on Wednesday.
The market is increasingly sensing tighter supplies, attributed to export challenges in Kurdistan and Venezuela, alongside disruptions to Russian supplies.
At the time of writing, the West Texas Intermediate crude oil was at $64.18 per barrel, up 1.2%, while Brent was at $68.40 a barrel, up 1.1% from the previous close.
Oil benchmarks had risen over $1 a barrel on Tuesday due to a stalled deal to restart oil exports from Iraq’s Kurdistan region.
This halt, in effect since March 2023, is preventing 230,000 barrels per day of oil from being shipped from the region to Turkey, as two major producers are demanding debt repayment guarantees.
In a sudden shift of rhetoric, US President Donald Trump stated on Tuesday that he believed Ukraine could reclaim all territory seized by Russia.
This statement followed an earlier push by the Trump administration that month, urging EU nations to accelerate the phasing out of Russian oil and gas.
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