Gold Remains Below $1,650, and Copper Awaits Important Production Reports

On Monday, gold prices inched up, but stayed below important support levels as markets anticipated future Federal Reserve rate hikes. In the meantime, copper markets awaited quarterly output figures from several of the world's largest miners, scheduled for release later this week.

The price of gold saw its worst week in two months with the release of statistics indicating that it will likely take considerably longer than anticipated for U.S. inflation to decrease. The reading heightened anticipation for additional anti-inflationary rate hikes at the Federal Reserve's November meeting.

The market has priced in a nearly 100 percent chance that the Federal Reserve will raise interest rates by 75 basis points for the third consecutive month in November. The increase will place U.S. interest rates at almost 4 percent, their highest level since late 2007.

Spot gold rose 0.1% to $1,646.02 per ounce at 19:25 E.T., while gold futures rose 0.2% to $1,651.35 per ounce (23:25 GMT). In the preceding week, both assets declined by more than 3 percent.

The yellow metal remained under pressure from the dollar's strength, which last month approached a 20-year high. Additionally, Treasury yields reached their highest levels since the 2008 financial crisis.

Rising interest rates have depressed gold prices and boosted the dollar this year, as the prospective cost of holding gold has climbed in step with lending rates. The trend has also significantly weakened gold's attraction as a safe haven, notwithstanding the deteriorating global economic situation.

Copper prices rose among industrial metals on Monday, but remained near two-year lows as the global economy stalled.

Copper futures per pound gained by 0.5% to $3.4220. The price of the red metal jumped by 1% last week, supported by a falling dollar and signs of a tightening supply due to Russia-related sanctions.

In the next months, however, the metal and the majority of its industrial counterparts may encounter formidable obstacles. During Sunday's 20th National Congress of the Chinese Communist Party, President Xi Jinping signaled that China, the world's top importer of metals, had no plans to pull back its economically damaging zero-COVID policy.

This year, the policy stalled economic activity in the world's second-largest economy, significantly reducing its appetite for imports of commodities.

This week, BHP Group (NYSE:BHP) and Rio Tinto (NYSE:RIO) will announce production figures for the third quarter, which will shed light on the copper supply side. In light of the fact that U.S. sanctions have blocked the exports of a number of Russian producers, a potential supply constraint could result in a price increase.

Rio Tinto's production figures will be released on Tuesday, while BHP's are expected on Wednesday.