Gold prices fell more than 1% on Tuesday (December 2) as investors took profits after hitting a six-week high in the previous session, while they awaited key US economic data ahead of next week's Federal Reserve policy meeting.

Spot gold fell 1.4% to $4,173.91 an ounce at 11:09 a.m. ET (16:09 GMT). US gold futures for February delivery fell 1.6% to $4,205.10 an ounce. "This is probably just a little profit-taking; the biggest focus of the market lately has been expectations of a rate cut, and those expectations remain fairly stable," said Peter Grant, vice president and senior metals strategist at Zaner Metals.

"We're in a continuation pattern that will ultimately lead to higher prices, and I still favor $5,000 gold at the start of the new year." Recent data showing a gradual cooling in the US economy, coupled with dovish signals from Federal Reserve policymakers, have strengthened market expectations for a 25 basis point interest rate cut at next week's Fed meeting, with traders pricing an 87% probability.

Investors are also eyeing the November ADP employment report, due on Wednesday, and the delayed September Personal Consumption Expenditures (PCE) Index, due on Friday, the Fed's preferred inflation gauge. Lower interest rates typically benefit non-yielding gold.

Central banks purchased 53 tonnes of gold in October, a 36% month-on-month increase and the largest monthly net demand since early 2025, according to the World Gold Council.

Silver weakened from a record high of $58.83 reached on Monday, falling 0.4% to $57.42 an ounce. Its price has risen more than 100% since the start of the year. "There are no new reasons for the recent surge in silver prices.

However, the well-known reasons remain: tight supply, reflected in low inventories on the Shanghai exchange," Commerzbank said in a note, adding that it expects further, albeit modest, price increases to $59 in the coming year.

Platinum fell 2.5% to $1,616.37, and palladium rose 1.2% to $1,441.37. (alg)

Source: Reuters.com