Gold prices maintained stability in early Asian trading on Monday, reflecting market optimism following reports of slower inflation in the United States. The spot gold price held steady at $2,323.74 per ounce, with gold futures slightly declining by 0.3% to $2,333.
In the second quarter, gold prices surged more than 4%, buoyed by expectations that the Federal Reserve may initiate interest rate cuts amid stable U.S. prices and moderate consumer spending growth, as reported last Friday.
The prospect of lower interest rates tends to reduce the opportunity cost of holding non-yielding bullion, thereby bolstering gold’s appeal as an investment.
According to the CME FedWatch tool, traders now anticipate a 63% probability of the first rate cut occurring in September.
Meanwhile, in India, physical gold demand remained subdued due to elevated prices, prompting some buyers to defer purchases in anticipation of potential import duty reductions in the upcoming budget.
In China, manufacturing activity showed a decline for the second consecutive month in June, while services activity remained stagnant. These developments have spurred calls for additional stimulus measures to bolster economic growth.
In the broader precious metals market, spot silver edged down by 0.3% to $29.05 per ounce, while platinum remained unchanged at $993.60. Palladium saw a modest increase of 0.2% to reach $974.50 per ounce.
