Gold Prices Edge Lower as Dollar Strengthens Ahead of Inflation Data

Gold prices experienced a slight decline in Asian trading on Wednesday, extending losses from the previous session as market focus remained on the upcoming U.S. inflation figures, bolstering demand for the dollar.

The precious metal continued to trade within a narrow range around the low $2,300 per ounce mark, a zone it has maintained for much of June, amid concerns over elevated U.S. interest rates impacting its price trajectory.

Spot gold dipped by 0.1% to $2,317.02 per ounce, while August gold futures also edged down by 0.1% to $2,328.40 per ounce as of 00:17 ET (04:17 GMT).

Gold Prices Consolidate Ahead of Key Economic Data

Gold struggled to gain traction this week, with trading volumes remaining subdued as investors awaited the release of the Personal Consumption Expenditures (PCE) price index, a crucial inflation gauge favored by the Federal Reserve.

Scheduled for release on Friday, the PCE data is expected to influence the Fed’s stance on interest rates moving forward. Recent indicators of economic resilience in the U.S., such as robust purchasing managers index readings and consumer confidence figures, have raised concerns that the Fed might opt to maintain higher rates for an extended period. Several Fed officials have echoed this sentiment throughout the week.

Additionally, a revised first-quarter Gross Domestic Product (GDP) reading is anticipated to provide further insights into the health of the U.S. economy this week.

Mixed Performance in Precious and Industrial Metals

While gold faced downward pressure, other precious metals saw mixed performance on Wednesday. Platinum futures managed a modest increase of 0.6%, reaching $1,005.25 per ounce, whereas silver futures rose marginally by 0.2% to $29.258 per ounce.

In contrast, industrial metals, particularly copper, traded mostly flat amid cautious sentiment regarding China, the largest global importer. Benchmark copper futures on the London Metal Exchange edged down by 0.1% to $9,561.50 per tonne, while one-month copper futures held steady at $4.3695 per pound.

The market’s caution towards copper stemmed from escalating concerns about potential trade tensions between China and Western nations. Recent tariff hikes on Chinese electric vehicles by the European Union and the U.S. have raised apprehensions about the future demand for copper, especially in the burgeoning electric vehicle sector.

These developments underscore the broader impact of geopolitical and economic factors on both precious and industrial metals markets, influencing investor sentiment and price trends moving forward.

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