Gold retreats from its highest level in 3 weeks

Gold prices fell during early Asian trading today from their highest level in nearly 3 weeks, as investors took profits amid increasing expectations of a cut in US interest rates later this month, while silver recorded a record high level.

Gold fell in spot transactions by about 0.2 percent, recording $4,221.68 per ounce by 01:09 GMT, after reaching its highest level since November 13 on Friday. US gold futures for December delivery rose by about 0.2 percent to $4,261.60 an ounce.

Silver rose in spot transactions by 2.2 percent, reaching a new high of $57.59 per ounce.

Markets currently expect 87 percent of interest rate cuts this month, according to the CME Group’s Fed Watch tool.

Recent statements issued by Christopher Waller, a member of the Federal Reserve Board of Governors, and John Williams, President of the Federal Reserve Bank of New York, in addition to weak economic data following the recent government shutdown, have strengthened expectations that the central bank will cut interest rates this month.

Gold, which does not yield a yield, rises when interest rates are low and during periods of geopolitical uncertainty.

Investors are looking to US manufacturing and private sector jobs data, due later this week, to assess the prospects for a rate cut at the central bank’s December 10 meeting.

The dollar stabilized near its lowest level since November 17, making dollar-denominated gold less expensive for holders of other currencies.

As for other precious metals, platinum fell by 0.2 percent to $1,669.15, while palladium rose 2.3 percent to $1,483.51.