Gold: Range-bound outlook with Fed headwinds – ING

ING’s commodities team reports Gold eased as markets digest the Federal Reserve’s first rate hike since 2023 and guidance for prolonged restrictive policy. They stress that higher rates remain a headwind, but ETF holdings at six‑month highs and ongoing central bank buying should cushion downside. LME copper holds above $14,500/t, with Chinese demand and supply risks keeping prices range-bound.

Gold softens as policy stays tight

"Gold edged lower at the start of the week as investors assessed the implications of the Federal Reserve's first rate hike since 2023 and the prospect of further policy tightening. Comments from Fed officials reinforced concerns that inflation remains elevated, supporting expectations that rates will stay higher for longer."

"While tighter monetary policy remains a headwind for bullion, ETF holdings are sitting at a six-month high, and continued central bank buying should help limit downside."

"LME copper is holding above $14,500/t, supported by signs of improving Chinese demand. The Yangshan premium climbed to $124/t, its highest level since November 2022, signalling stronger import appetite, while domestic production eased slightly in August."

"Copper remains up more than 16% this year amid ongoing supply tightness driven by stronger US imports ahead of potential refined copper tariffs. Near-term price action is likely to remain range-bound as supply risks offset macro headwinds and markets await greater clarity on US trade policy."