Investing.com-- Gold prices fell from a more-than two-week high in Asian trade on Thursday as investors gauged the implications of in-line U.S. consumer inflation data on the outlook for interest rates.
Among industrial metals, copper prices rose further on optimism over more stimulus measures from top importer China.
Gold clocked some gains this week as heightened geopolitical tensions in the Middle East and Asia fueled safe haven demand. But overall gains in metal markets were still constrained by strength in the dollar.
Spot gold fell 0.1% to $2,715.14 an ounce, while gold futures expiring in February fell 0.3% to $2,747.61 an ounce by 23:35 ET (04:35 GMT).
In-line CPI data cements Dec rate cut bets
Gold rose sharply in overnight trade as in-line consumer price index inflation data saw traders ramp up bets that the Fed will cut rates next week. Markets were seen pricing in a 98% chance for a 25 basis point cut, according to CME Fedwatch.
But gains in gold were held back by improved risk appetite, as Wall Street indexes also surged on the prospect of lower rates in the near-term.
Resilience in the dollar also limited gold’s upside, as traders favored the greenback amid increased doubts over the long-term outlook for inflation and interest rates. Wednesday’s CPI reading showed inflation at its strongest level in seven months- a trend that is expected to keep the Fed cautious over further monetary easing.
Focus is now on producer price index data due later on Thursday, which comes just days before the Fed’s final meeting for the year.
The central bank’s outlook on rates will be closely watched, amid growing bets that it will adopt a slower pace of easing in 2025.
Other precious metals were mixed after clocking some gains this week. Platinum futures rose 0.6% to $956.45 an ounce, while silver futures steadied at $32.955 an ounce.
Copper upbeat on China stimulus cheer
Benchmark copper futures on the London Metal Exchange rose 0.8% to $9,251.0 a ton, while February copper futures rose nearly 1% to $4.3033 a pound.
Both contracts hit a one-month high on Wednesday amid increased optimism over more stimulus measures in top importer China.
Beijing struck its most dovish tone yet on loosening monetary policy to support economic growth, the country’s Politburo signaled after a meeting on Monday.
China’s Central Economic Work Conference- a high-level government meeting- is set to conclude later on Thursday, setting the economic agenda for 2025 and also offering more cues on plans for stimulus.