Gold prices fell on Thursday (January 8) as investors braced for futures selling related to the commodity index rebalance, with a stronger U.S. dollar adding to the pressure by making the metal more expensive for overseas buyers.
Spot gold prices fell 0.6% to $4,427.48 per ounce, as of 0921 GMT. U.S. gold futures for February delivery fell 0.6% to $4,435.40.
"Gold and silver remain under pressure as the annual commodity index rebalance gets underway. Over the next five days, COMEX futures could see selling in the range of $6 to $7 billion for each metal," said Ole Hansen, head of commodity strategy at Saxo Bank.
The annual Bloomberg Commodity Index rebalance aims to keep the index aligned with current global commodity market conditions. This year's period runs from January 9-15.
"(The US-Venezuela conflict) added a small georisk premium earlier in the week that is now starting to ease as attention shifts to rebalancing," Hansen added.
Meanwhile, the US dollar fluctuated near a one-month high as investors assessed mixed economic data ahead of Friday's non-farm payrolls report.
Data on Wednesday showed US job openings fell to a 14-month low in November while hiring slowed, indicating a decline in labor demand.
Investors are now awaiting US non-farm payrolls data for further clues on monetary policy, with markets expecting two interest rate cuts by the Federal Reserve this year.
On the geopolitical front, the US seized two oil tankers linked to Venezuela in the Atlantic Ocean on Wednesday. Spot silver fell 3.1% to $75.73 an ounce, after hitting an all-time high of $83.62 on December 29.
HSBC predicts gold prices will reach $5,000 per ounce in the first half of 2026 due to geopolitical risks and rising fiscal debt. It also forecasts silver prices to trade between $58 and $88 in 2026, driven by supply deficits, strong investment demand, and high gold prices. However, it warned of a market correction later in the year.
Spot platinum fell 4.2% to $2,209.50 per ounce, while palladium fell 4.4% to $1,687 per ounce. (alg)
Source: Reuters.com
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