Gold prices fell on Monday as the dollar index rose against most major rivals, moving away from record highs scaled earlier in the session. 

Later this week, the all-important US payrolls report will be released later this week. 

Fed Chair Jerome Powell said last week that inflation hasn't be fully controlled yet and talk about interest rate cuts are too early. 

Otherwise, the dollar index fell 0.4% to 103.6 as of 17:23 GMT, with a session-high at 103.8, and a low at 103.06. 

On trading, gold spot prices fell 2% as of 17:14 GMT, or $41.4, to $2,048 an ounce away from a record high at $2152.30 an ounce. 

Copper prices fell on Monday as the dollar rose against a basket of major rivals, amid growing concerns about increasing inventories at the London Metals Exchange. 

Copper standard futures fell 1.3% at the London Metals Exchange to $8500 a tonne, away from a four-week high at $8640. 

As the dollar rose, it made dollar-denominated metals futures costlier to holders of other currencies.

Copper inventories at the London Metals Exchange rose on Friday to 174.900 tonnes, becoming nearly 225% higher from July levels.

Otherwise, China reported mixed data for factory activities in November, raising doubts about demand, while data on commerce and inflation will be released later today.

Technically, copper is standing at $8,445, at the 200-day SMA, with a resistance at $8640. 

Copper found some support from the disrupted supplies in Panama, as the First Quantum company suspended operations at its mine, representing 1% of global supplies. 

Nickel prices rose today on active short-covering away from March 2021 lows plumbed recently at $15,840. 

Aluminium fell 0.7% to $2193 a tonne, while zinc fell 1.4% to $2474, as lead rose 0.5% to $2130, while tin rose 0.5% to $23880. 

The dollar index rose 0.5% as of 16:36 GMT to 103.7, with a session-high at 103.8, and a low at 103.06.

Copper futures due in March fell 2.4% to $3.83 a pound as of 16:30 GMT. 

Dollar rose in European trade on Monday against a basket of major rivals, on track for the third profit in four days on active short-covering.

The gains come despite strong prospects of early interest rate cuts by the Federal Reserve in 2024, potentially even in March.

The Index

The dollar index rose 0.3% to 103.52, with a session-low at 103.06, after losing 0.3% on Friday, resuming losses and trading near three-month low at 102.47 following  cautious remarks by Fed Chair Jerome Powell. 

Powell 

Fed Chair Jerome Powell said on Friday that it's clear the monetary policy is slowing the economy down as expected, with interest rates reaching appropriate tightening levels, however he still opened the way for further policy tightening if needed

US Rates

Odds for a US interest rate hike at the December Fed meeting fell to just 2.5%

Odds for an interest rate cut by the Fed in March surged to 64%, while odds for a cut in May surged to 90%.

Economic Slowdown 

Powell's remarks came after data showed the US manufacturing sector remained soft in November, showing the impact of US policy tightening.

The ISM Institute showed the manufacturing PMI remained at 46.7 in November, the 13th month in a row of a result below 50, which separates contraction from growth.

Sterling fell in European trade on Monday against euro away from three-month highs and on track for the first loss in five sessions on profit-taking.

Despite the decline, sterling is expected to rebound as the gap between UK and Euro zone treasury yields tilts in the pound's direction.

EUR/GBP

EUR/GBP rose 0.3% to 0.8585, with a session-low at 0.8553, after rising 0.8% on Friday, the fourth profit in a row, and the largest since February 2023, marking three-month highs at 0.8552. 

Sterling rallied 1.4% against euro last week, marking the best weekly profit in 2023 as investments move readily in favor of the pound due to future prospects of interest rates.

In the UK, investors are reducing bets on early interest rate cuts by the Central Bank, with the opposite course in the euro zone. 

Thus the government yield gap between the UK and euro zone rallied considerably in favor of the pound. 

Recent Euro zone inflation data bolstered the case for an early interest rate cut by the European Central Bank in 2024, potentially in May.

Conversely, markets don't expect Bank of England to enact the first interest rate cut until later in the summer. 

Several BOE officials recently asserted that interest rates will remain at the tight 5.25% level for an extended duration until inflation is reliably brought under control.