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Gold prices steady, CPI data awaited for more rate cues

Published 08/12/2024, 01:28 PM
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Investing.com-- Gold prices steadied in Asian trade on Monday, remaining close to record highs as traders awaited more cues on U.S. interest rates from key inflation data due later in the week. 

The yellow metal logged wild swings last week amid increased volatility in broader financial markets, although it ended the week marginally higher. The yellow metal also benefited from safe haven demand amid concerns over a bigger war in the Middle East, and as Ukraine launched an offensive against Russia. 

Spot gold rose 0.1% to $2,433.62 an ounce, while gold futures expiring in December steadied at $2,472.20 an ounce by 01:03 ET (05:03 GMT). 

Gold steadies with CPI data on tap 

Spot gold was also less than $50 away from a record high. But further gains in the yellow metal were held back by anticipation of consumer price index inflation data due on Wednesday.

The reading is expected to show inflation cooled slightly in July, giving the Federal Reserve more confidence to begin cutting interest rates. 

Traders are split over a 25 or 50 basis point cut by the central bank in September. 

Lower interest rates bode well for gold, given that they reduce the opportunity cost of investing in the yellow metal.

Other precious metals were rangebound on Monday. Platinum futures rose 0.2% to $931.40 an ounce, while silver futures steadied at $27.595 an ounce. 

Copper edges higher, but nurses losses 

Among industrial metals, copper prices rose slightly on Monday, but were nursing steep losses in recent weeks amid souring sentiment towards top importer China.

Concerns over a broader economic slowdown also battered the red metal, given that slowing economic growth bodes poorly for copper demand. 

Benchmark copper futures on the London Metal Exchange rose 0.2% to $8,853.50 a ton, while one-month copper futures rose 0.2% to $3.9912 a pound.

Both contracts fell sharply over the past month amid a slew of weak economic readings from China. Particularly concerning was data showing two straight months of declines in Chinese copper imports.

More economic readings from China are on tap this week, with industrial production and retail sales data due on Thursday.

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