Investing.com– Gold prices rose marginally in Asian trade on Wednesday, seeing little support from safe haven demand as recent comments from Federal Reserve officials saw markets second-guess expectations for interest rate cuts.
The yellow metal saw some safe haven demand this week as a conflict between Israel and Hamas worsened and ceasefire talks yielded little progress.
But safe haven buying was offset by pressure from renewed fears of high U.S. interest rates, as well as a rebound in the dollar.
rose 0.2% to $2,317.70 an ounce, while expiring in June steadied at $2,325.40 an ounce by 00:12 ET (04:12 GMT). Spot prices remained more than $100 below a record high hit in late-April.
Gold under pressure as Fed officials cool rate cut bets
Prices of the yellow metal saw little support from a recent decline in the dollar, as the greenback rebounded on Tuesday after several Fed officials said the central bank was more likely to keep rates unchanged in 2024.
This notion was pushed by Minneapolis Fed President Neel Kashkari on Tuesday, and saw traders rethink some expectations for rate cuts this year.
Expectations of a September rate cut had risen after weak payrolls data last week. But Kashkari and his peers said that sticky inflation still remained a key point of contention for the Fed.
The prospect of high for longer U.S. rates bodes poorly for gold, given that it pushes up the opportunity cost of investing in the yellow metal.
Other precious metals were also a mixed bag amid pressure from U.S. rate fears. steadied at $988.35 an ounce, while rose 0.3% to $27.635 an ounce.
remove ads
.
Copper prices retreat on mixed supply signals, China caution
Among industrial metals, copper prices retreated from two-year peaks on Wednesday after expectations of tighter supplies were slightly offset by U.S. miner Freeport-McMoran (NYSE:) flagging exports of as much as 900,000 metric tons of copper concentrate from its Grasberg mine in Indonesia.
The prospect of higher exports somewhat offset bets on tighter supplies following stricter sanctions on Russian metal exports and production cuts by Chinese refiners.
on the London Metal Exchange fell 0.5% to $9,974.50 a ton, while fell 0.4% to $4.5732 a pound.
Metal markets were also on edge before from key copper importer China, due on Thursday, which is expected to provide more cues on metal demand in the country.