Gold Price News: Gold Edges Lower as Markets Eye US Election

Gold prices were marginally lower on Wednesday morning, with the financial markets watching out for the outcome of the US Presidential election.

Prices edged up to an intra-day high of $2,750 an ounce on Tuesday, compared with around $2,736 an ounce in late trades on Monday. However, prices fell to around $2,730 an ounce in early deals on Wednesday.

Overall, gold prices had been relatively steady in recent days, having pulled back from all-time highs of $2,792 an ounce on October 30^th.

The markets had been waiting for the outcome of Tuesday’s US Presidential election, with polls showing Democratic nominee Kamala Harris holding a thin lead over her Republican counterpart Donald Trump in the final days leading up to the vote.

Gold prices had appeared to make gains earlier on the back of expectations of a Trump win, due to a perception of increased trade tariffs and other protectionist policies under that outcome, which could support safe-haven assets.

As of Wednesday morning, voting results showed that Trump had made significant gains, and was already making victory speeches, albeit with votes still being counted in some states.

US ISM services figures show surprise improvement

On the data front, US ISM Services PMI figures were released for October on Tuesday, showing a surprise increase to 56, compared with market expectations of 53.8. The figures indicated a stronger-than-expected US economy in October, underpinned by a rebound in employment and easing price pressures. The latest readings could work against calls for more aggressive interest rate cuts by the US Fed in the coming months.

Upcoming events to watch out for

Wednesday will see a speech by ECB President Christine Lagarde, which will be watched for clues on the state of the European economy, with the ECB having cut interest rates three times so far in 2024.

Attention is now likely to turn to Thursday’s expected interest rate decision by the US Fed. The latest data from interest rate traders indicates a 97% probability that the Fed will slash rates by 25 basis points at the meeting and a 78% probability of a similar-sized cut in December.