Gold Prices Steady Amid Political Turmoil

Gold prices moved little in Asian trade on Thursday, seeing little safe haven demand despite political turmoil in France and South Korea, as risk appetite improved and the dollar remained strong.

A rally on Wall Street to record highs largely undermined haven demand for gold, as did comments from Federal Reserve Chair Jerome Powell flagging a more cautious approach to future interest rate cuts.

Spot gold fell slightly to $2,649.09 an ounce, while gold futures expiring in February fell 0.1% to $2,672.99 an ounce by 23:14 ET (04:14 GMT).

Limited Safe Haven Demand Amid Political Issues

The yellow metal saw limited safe haven demand this week even as France’s government collapsed, while calls for the impeachment of South Korean President Yoon Suk-Yeol grew after his unsuccessful attempt to impose martial law in the country.

Risk-driven assets largely brushed off the political turmoil. While local markets in France and South Korea weakened, broader markets largely advanced this week, with Wall Street indexes hitting record highs overnight on strength in technology shares.

Other precious metals were also muted on Thursday. Platinum futures rose 0.1% to $949.60 an ounce, while silver futures fell 0.5% to $31.767 an ounce.

Among industrial metals, benchmark copper futures on the London Metal Exchange fell 0.2% to $9,086.50 a ton, while February copper futures fell 0.1% to $4.1943 a pound.

Dollar Stability Affects Metal Markets

Resilience in the dollar also pressured metal markets. The greenback rose sharply earlier this week after U.S. President-elect Donald Trump threatened to impose tariffs on several countries.

The dollar mostly retained its gains after Powell lauded recent strength in the U.S. economy.

Speaking at a New York Times event, Powell indicated that strength in the economy allows the Fed to adopt a more cautious approach to future easing.

While he did not dismiss expectations for a December rate cut, Powell’s comments did instill caution about a slower pace of rate cuts in 2025. Expectations of inflationary policies under Trump also spurred uncertainty regarding potentially high rates in the long term.

Higher for longer rates herald more pressure on non-yielding assets such as metals.

Focus this week is on key nonfarm payrolls data, due on Friday, which is likely to influence expectations for future rate cuts.