Gold down as investors evaluate the OPEC + production cut, ‎weak US data releases

Gold prices fell today, Tuesday, as investors assessed the expected path of monetary policy in the United States, after data showed a decline in manufacturing activity there and amid inflationary risks raised by production cuts from the OPEC + group.

According to Reuters, gold in spot transactions fell 0.3 percent to $1978.10 an ounce by 0549 GMT, while US gold futures fell 0.2 percent to $1997.30.

The dollar index rose 0.2 percent, which makes the precious metal more expensive for buyers holding other currencies.

Gold is considered a tool to hedge against inflation, but high interest rates also raise the opportunity cost of owning it, as it does not yield a return.

Oil prices rose as investors turned their attention to the future of demand and the impact of high prices on the global economy

Gold prices fell on Monday, after the OPEC + group announced a sudden cut in crude oil production at the beginning of the week. However, prices changed direction, rising 1 percent, with the dollar falling, following the publication of weak US economic data

US manufacturing activity fell in March to its lowest level in nearly three years as new orders tumbled and may continue to decline due to tightening credit.

Markets expect by 58.7 percent that the Federal Reserve (the US central bank) will raise interest rates by a quarter of a percentage point in May, but the possibility of a rate cut later in the year has also risen.

“During the short term (the second quarter), we expect gold to derive more support from a scenario in which both inflation and interest rates may peak,” Edward Meir, a metals analyst at Marex, said in a note.

He added, “If our expectations are correct, then this is expected to lead to a decline in the dollar and pave the way for a larger upward movement (for gold).”

Silver lost 0.9 percent in spot transactions, recording $ 23.79 an ounce, while platinum fell 0.3 percent to $ 982.62, and palladium fell 0.4 percent to $ 1453.64.