Investing.com — Gold prices were steady in Asian markets on Friday, but the metal has fallen sharply throughout the week after slipping from record highs on concerns about higher U.S. interest rates for a long time.
Interest rate concerns have pushed up prices and weighed on metals prices across the board, with copper also falling sharply from its all-time high this week.
Gold was also hit hard by a decline in demand as a safe-haven asset after the death of the Iranian president did not escalate tensions in the Middle East as initially expected.
As of 00:37 ET (04:37 GMT), June maturities were up 0.2% at $2,332.77 an ounce and down 0.1% at $2,333.85 an ounce.
Gold prices see sharp weekly losses on interest rate worries
Gold has fallen sharply from record highs hit earlier this week and is expected to fall about 3.4%.
Gold has faced headwinds this week as demand for the safe-haven asset has waned and concerns about long-term interest rates remaining high.
Hawkish signals from the Federal Reserve suggest policymakers are growing concerned about persistent inflation, with some signaling an openness to further rate hikes.
While further rate hikes are seen as unlikely, the hawkish comments prompted traders to sharply downgrade their forecasts for a cut in 2024. Traders appear to rate a September cut as roughly equal to the probability of keeping rates on hold.
High interest rates for a prolonged period of time bodes badly for gold as it increases the opportunity cost of investing in it.
Other precious metals were stable on Friday and are expected to be lower on the week, rising 0.4% to $1,029.90 an ounce and 0.4% to $30.582 an ounce.
Copper stabilizes after falling from record highs
Crude oil futures on the London Metal Exchange rose 0.8% to $10,450.50 a tonne, while one-month U.S. futures rose 0.7% to $4.8102 a pound.
Both contracts have fallen from record highs this week as the speculative frenzy that drove earlier gains appears to be subsiding. Traders are waiting to see whether physical deliveries of the contracts can be made in time, which will provide further clues about copper supply conditions.
Weakening sentiment toward China, the largest copper importer, also weighed on the market, as optimism about further stimulus measures was largely offset by a simmering trade war with the United States and tensions with Taiwan.
