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Gold prices dip as dollar, Treasuries firm before CPI data By Investing.com – Investing.com


©Reuters.

Investing.com — Gold prices fell on Wednesday, pressured by a fresh rise in the dollar and yields as markets sank ahead of key U.S. inflation data due later in the day.

Bullion prices hit their lowest in more than two weeks as the market expressed the view that inflation indicators could potentially strengthen on the back of soaring fuel prices and strong consumer spending.

The dollar was chosen as a safe haven, with some expecting Wednesday’s inflation numbers to set the tone for next week’s Federal Reserve meeting. While prices remain below their six-month highs, the highest prices in more than 20 years are within sight.

It fell 0.1% to $1,911.66 an ounce by 00:32 ET (4:32 GMT) and 0.1% to $1,933.85 an ounce by December deadline.

CPI will be measured immediately before the Fed meeting

Inflation is expected to rise 0.6% in August, accelerating from July’s monthly pace of 0.2%, according to the data. is expected to stabilize at 0.2%.

Signs of further increases in U.S. inflation could give the Fed further impetus to raise rates, or keep them high for an extended period of time. That’s the case for now, but a strong outlook could lead to more hawkish statements from the Fed next week.

Rising interest rates bode poorly for gold and other metals, given that they increase the opportunity cost of investing in non-yielding assets. This belief has hurt gold throughout the past year, limiting the yellow metal’s significant recovery.

US interest rates are expected to remain high until at least mid-2024, limiting prospects for gold’s recovery, while lower recession expectations this year also point to weak safe-haven demand for the yellow metal. ing.

Still, some funds may flow into bullion due to economic downturns in other major countries.

Copper prices fall as Chinese support dries up

Among industrial metals, copper prices fell slightly on Wednesday, reversing some of their recent gains as China-led gains lost momentum.

It fell 0.3% to $3.7780 per pound, after falling 0.4% in the previous session.

Although recent data shows some improvement in China’s economy, the world’s largest Overall sentiment towards copper importing countries remains bleak.

All eyes are on August data to be released on Friday for further clues about economic activity.

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