Gold prices remained close to record highs on Monday, supported by a weaker U.S. dollar, with market focus shifting toward a crucial inflation report later this week.
As of 0703 GMT, spot gold rose by 0.1% to $2,939.91 per ounce, having reached an all-time high of $2,954.69 last Thursday. U.S. gold futures remained unchanged at $2,953.30.
Tim Waterer, Chief Market Analyst at KCM Trade, attributed the rise in gold prices to disappointing U.S. macroeconomic data late last week, which put downward pressure on the dollar and created an opportunity for gold to climb higher. “With trade uncertainties persisting, gold could potentially reach new all-time highs again this week,” he added.
Last week, U.S. President Donald Trump escalated trade tensions, threatening to impose new tariffs on a range of products, including lumber and forest goods, in addition to previously announced duties on imported cars, semiconductors, and pharmaceuticals.
Markets are now awaiting the release of the Personal Consumption Expenditures (PCE) price index on Friday, which is the Federal Reserve’s preferred measure of inflation. The data could offer further insight into the central bank’s interest rate decisions. If inflationary pressures prompt the Fed to maintain high rates, gold’s appeal as a non-yielding asset could diminish.
Ajay Kedia, Director at Kedia Commodities in Mumbai, noted that to push gold prices above the $3,000 mark, a very strong catalyst would be needed, as the “war premium” appears to have waned, and other supportive factors have already been priced in.
In geopolitical developments, Trump revised his stance on Friday, acknowledging that Russia had indeed invaded Ukraine and revealing that Kyiv would soon sign a minerals agreement with the U.S. as part of efforts to resolve the conflict.
In other metals, spot silver increased by 0.4% to $32.65 per ounce, while platinum gained 0.3% to $972.68. Palladium, however, dropped by 0.4%, trading at $965.81 per ounce.
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