Metals Stocks: Gold prices slip a bit ahead of Fed meeting this week

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Gold futures settled at a slight loss on Monday, finding little reason to move in either direction ahead of a mid-week policy update from the Federal Reserve and a U.K. general election that could roil markets.

The coming two-day Fed meeting, which begins Tuesday and concludes with a monetary policy decision on Wednesday, has held “gold in check,” said George Gero, managing director at RBC Wealth Management. “While buyers wait [for] more headlines and news items, there is little reason for long term holders to sell now.”

For now, prices are bound to a $1,450 to $1,500 range, but looking to move “higher soon,” he said, in a daily update.

February gold GCG20, -0.05%  on Comex lost 20 cents, or 0.01%, to settle at $1,464.90 an ounce, after declining 0.5% last week. March silver SIH20, +0.23%, meanwhile, added 4.6 cents, or 0.3%, at $16.642 an ounce, following a weekly decline of 3%, according to FactSet data.

On Monday, after sinking on the back of a hotter-than-expected U.S. jobs report on Friday, gold initially saw some support following economic reports out of China that showed the world’s second-largest economy continued to be hurt by trade conflicts and a global economic slowdown.

China trade data showed that exports to the U.S. had fallen 23% year-over-year in November. More broadly, exports to all countries fell 1.1% year-over-year.

However, prices for gold gave up earlier gains as news emerged that House Democrats reached a tentative agreement over a rewrite of the U.S.-Mexico-Canada trade deal. The Associated Press attributed the news to an anonymous Democratic aide, who’s not authorized to discuss the talks.

Meanwhile, the dollar, as measured by the ICE U.S. Dollar Index DXY, -0.04%, showed some weakness Monday, following a retreat 0.6% last week. The index gauges the buck against a half-dozen currencies, with weakness in the dollar usually helping to support gains in assets priced in dollars because it makes those assets less expensive to buyers using other monetary units.

The move for the dollar came as the British pound GBPUSD, +0.0685% ticked higher ahead of U.K. elections on Thursday, with weekend polls indicating that Prime Minister Boris Johnson and his Conservative Party will have a strong outcome, as he attempts to push Britain out of the European Union.

Before that general election, the Fed will host its last meeting of 2019, though the central bank is expected to stand pat this week, commodity investors will look for clues from the rate-setting Federal Open Market Committee about the direction of interest-rate policy and economic stimulus.

Among other metals traded on Comex, March copper HGH20, +1.12%  settled at $2.7585 a pound, up 1.2%.

“Over the weekend, China announced copper imports hit a 13-month high last month and they cited improved factory activity for those strong imports, therefore, traders should not discount the capacity for March copper to regain $2.80 in the coming weeks.,” said analysts at Zaner Metals, in a daily note.

January platinum PLF20, -0.29%  inched down by 0.04% to $898.50 an ounce and March palladium PAH20, +0.36%  rose 0.6% to $1,856.60 an ounce.

Also see: Here’s what Trump’s plan to ‘restore’ Brazil, Argentina steel and aluminum tariffs mean for the metals