WASHINGTON (dpa-AFX) - Gold prices were flat to slightly higher on Wednesday and the dollar was rising after strong U.S. economic data firmed expectations that the Federal Reserve will take a cautious approach to cutting interest rates in 2025.
Spot gold edged up by 0.2 percent to $2,654.47 in European trade amid persisting U.S.-China trade tensions and investor anxiety over tariff hikes proposed by U.S. President-elect Donald Trump. U.S. gold futures were marginally higher at $2,667.11.
U.S. service sector growth picked up in December, a measure of prices paid for inputs rose to near a two-year high, and job openings unexpectedly increased in November, prompting traders to push back their expectations on when the Fed can cut interest rates this year.
The main focus of this week is Friday's key non-farm payrolls data, along with minutes from the Fed's December meeting due later in the day.
Analysts say that the U.S. economy and job market will remain healthy in 2025, but growth could slow as Trump tariff, immigration plans take shape.
As uncertainties mount, traders are currently pricing in only one Fed rate cut until the second half of the year.
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