Ammon News - Gold prices ticked lower on Tuesday, after surging more ‌than 2% in the previous session on a drop in oil prices that eased inflation concerns, while investors awaited the outcome of US midterm elections later in the day.

Spot gold fell 0.5% ​to $3,926.52 per ounce by 0353 GMT. Prices climbed over 2% to $3,954.41 per ​ounce in the previous session, rebounding from a one-year low it ⁠hit on Friday.

US gold futures for December delivery dropped 0.8% to $3,936.30.

"Gold is still in ​consolidation mode after the price pummelling it took last week," said Tim Waterer, chief ​market analyst at KCM Trade.

"Gold continues to be sold as a high-liquidity asset to cover losses and margin calls elsewhere rather than being bought as a traditional safe haven. That characteristic is ​working against it in the current environment," Waterer added.

On the geopolitical front, Tehran said ​on Monday, contacts between Iran and the United States to end their eight-month war were continuing ‌after days ⁠of Iranian talks with Qatari mediators ended with altered proposals but no breakthrough. Oil prices fell over 7% on Monday.

Elevated energy prices raise expectations that the Fed will keep interest rates higher-for-longer, increasing the opportunity cost of holding non-yielding bullion.

Traders currently ​see a 74% chance ​that the central ⁠bank will raise rates in December, according to CME's FedWatch tool.

Market participants now await the US midterm elections later today and ​their potential impact on broader market sentiment.

"A Democratic sweep would ​likely prove ⁠more problematic for the AI data-centre build-out and the broader tech trade. Any further pressure on the tech complex from increased regulatory scrutiny could therefore spill over into gold ⁠as positions ​continue to be cut to cover losses elsewhere," ​Waterer said.

Among other metals, spot silver slipped 1.8% to $49.71 per ounce, platinum dropped 0.2% to $1,446.80 and palladium dipped ​1.4% to $953.64.


Reuters