Gold prices steady as Fed chair signals cautious approach

Gold prices held steady following modest gains as markets digested Federal Reserve Chair Jerome Powell's comments, which set the stage for upcoming economic data that could influence the central bank's next interest rate decision.

The precious metal hovered near $2,650 per ounce after Powell suggested that policymakers may take a measured approach to reducing rates. This comes as traders focus on the U.S. nonfarm payrolls report, due Friday, expected to provide crucial insights ahead of the Federal Reserve's policy meeting on December 17–18 in Washington. Markets are anticipating a 25-basis-point rate cut at the meeting.

Gold has been trading in a narrow range since early last week, with diminished bid-ask spreads reflecting investors' search for fresh market drivers. Despite recent stability, the metal is down 5% from its record high in late October, pressured by a stronger dollar following Donald Trump's election win and easing tensions in the Middle East. However, gold prices remain up 28% for the year, supported by U.S. rate cuts and robust central bank buying.

Spot gold prices were little changed at $2,649.27 per ounce as of 8:21 a.m. Singapore time, following a 0.2% increase on Wednesday. Meanwhile, silver and palladium prices held steady, and platinum registered a modest gain.

As markets await Friday's labor data, the spotlight remains on whether gold can regain upward momentum or continue consolidating within its recent range.