Gold prices in Asian trading on Thursday saw an uptick, supported by a weaker dollar and declining Treasury yields amid heightened speculation over potential U.S. interest rate cuts ahead of key inflation data.
The precious metal has maintained gains this week, driven by reports of increased gold purchases by central banks in emerging markets. Comments from Federal Reserve Chair Jerome Powell, indicating a dovish stance, further bolstered gold’s advance.
Spot gold rose 0.4% to $2,381.73 per ounce, while August gold futures climbed 0.3% to $2,386.75 per ounce by 00:42 ET (04:42 GMT).
Focus on CPI Data
Gold remained strong as Powell’s remarks highlighted progress in controlling inflation in recent months. Powell clarified that while the Fed does not require inflation to drop below its 2% target before considering rate cuts, greater confidence in inflation easing is necessary.
Traders have largely maintained their expectations for a rate cut in September, with the CME FedWatch tool indicating a 72.5% probability of a 25 basis point reduction.
The dollar weakened in response to Powell’s comments, with market attention now turning to the upcoming release of the consumer price index (CPI) data later on Thursday, expected to show a modest cooling in inflation.
Other Precious Metals and Market Outlook
Silver futures rose 0.9% to $31.290 per ounce, outpacing gold’s gains in recent months, while platinum futures fell marginally to $1,005.25 per ounce.
Analysts at TD Securities anticipate continued upward momentum for gold in the short term, supported by ongoing central bank purchases in emerging markets and clearer expectations of U.S. interest rate cuts.
Industrial Metals Outlook
Meanwhile, copper prices also saw an increase on Thursday, benefiting from a softer dollar. However, recent economic data from China, including underwhelming inflation figures, has weighed on copper prices, signaling concerns about the country’s economic recovery.
Benchmark copper futures on the London Metal Exchange rose 0.1% to $9,914.50 a tonne, with one-month copper futures up 0.5% to $4.6147 a pound. Traders are now awaiting upcoming trade data from China for further insights into market trends.
