Gold Prices Slip Slightly But Keep Record Highs in Sight Ahead of Inflation Data
Gold prices dipped slightly in Asian trading on Tuesday but remained near recent highs as investors looked ahead to key U.S. inflation data, which could provide more clarity on the Federal Reserve’s interest rate plans.
The yellow metal has benefited from its safe-haven status, particularly after last week’s risk-off move across markets driven by concerns over slowing economic growth.
Spot gold fell 0.1% to $2,502.07 an ounce, while December gold futures slipped 0.1% to $2,531.0 an ounce by 00:22 ET (04:22 GMT). Despite the dip, gold remains close to the record high it approached last Friday.
Gold Stable Amid Inflation Watch and Fed Speculation
This week, market attention is focused on U.S. consumer price index (CPI) data, due Wednesday, for insights into the state of the economy. A softer inflation reading could increase expectations for rate cuts, which would support gold prices.
The inflation data comes just one week before the Federal Reserve’s next meeting, where the central bank is expected to reduce interest rates by 25 basis points. This anticipated rate cut has been a major factor in gold’s recent rise, as it is expected to mark the beginning of an easing cycle by the Fed.
Lower interest rates tend to favor gold, as they reduce the opportunity cost of holding non-yielding assets like the precious metal.
Other precious metals also saw declines on Tuesday, with platinum futures falling 0.1% to $945.0 an ounce and silver futures down 0.2% to $28.590 an ounce.
Copper Slips as Chinese Trade Data Offers Limited Support
Copper prices edged lower on Tuesday, showing little reaction to data that indicated some economic resilience in China, the world’s largest copper importer.
China’s trade balance improved unexpectedly in August, boosted by stronger exports. However, weak import figures tempered optimism, as they reflected sluggish demand within the country.
China’s copper imports fell 12.3% year-on-year in August, contributing to concerns over a slowdown in the nation’s economic growth. This, coupled with a broader risk-off sentiment in global markets, saw copper prices suffer steep losses over the past week.
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