Gold prices inched higher in Asian trading on Thursday, remaining near record highs as the weakening dollar and heightened bets on U.S. interest rate cuts bolstered demand for the precious metal. Reports indicating worsening trade relations between the U.S. and China also boosted safe-haven demand.
As of 00:58 ET (04:58 GMT), spot gold rose by 0.3% to $2,466.18 per ounce, while August gold futures climbed 0.4% to $2,469.55 per ounce. Spot prices had soared to an unprecedented $2,483.78 per ounce.
The recent surge in gold prices has been underpinned by soft U.S. inflation data and dovish comments from Federal Reserve officials, which have intensified expectations of a rate cut. According to CME’s FedWatch Tool, traders are pricing in a 94% probability of a 25 basis point rate reduction in September, with a slight chance of a larger 50 basis point cut.
The U.S. dollar, nearing a four-month low, has further supported commodities priced in the greenback, including gold. Safe-haven demand for gold was additionally fueled by a Bloomberg report suggesting potential stricter trade restrictions on China by the U.S., particularly targeting the technology and semiconductor sectors.
Geopolitical tensions escalated following remarks from U.S. Republican presidential candidate Donald Trump, who advocated that Taiwan should fund U.S. defense supplies, exacerbating concerns over U.S.-China relations and renewing fears of a trade war.
In tandem with gold, other precious metals also advanced. Platinum futures rose by 0.2% to $1,011.75 per ounce, while silver futures surged 0.7% to $30.573 per ounce.
Conversely, copper prices experienced a decline amid apprehensions about Chinese economic prospects and trade tensions. Benchmark copper futures on the London Metal Exchange fell by 0.2% to $9,613.50 per tonne, with one-month copper futures dropping by 0.4% to $4.3985 per pound.
Investors are closely monitoring developments surrounding the Third Plenum of the Chinese Communist Party, anticipating potential stimulus measures amid economic pressures.
