Investing.com — Gold prices stabilized near two-week highs in Asian trade on Wednesday as geopolitical instability in Asia and the Middle East supported safe-haven demand.
The yellow metal also attracted some bids as markets turned risk-averse ahead of key US inflation data due later on Wednesday, which is likely to be factored into the interest rate outlook.
Among industrial metals, copper prices soared on continued optimism about further stimulus from China, its biggest importer. Encouraging copper import statistics from the country also supported sentiment.
The February expiry rose 0.8% to $2,739.82 an ounce by 23:29 ET (4:29 GMT) and was steady at $2,694.16 an ounce.
China-Taiwan, Syria tensions spur demand for shelters
Gold's rally this week comes amid heightened geopolitical tensions in the Middle East following the overthrow of the Syrian government by rebel groups. With Iran's dominance in the Middle East potentially weakening, markets were focused on how this would affect the region.
In Asia, Taiwan has been put on alert after China reportedly carried out its largest maritime maneuver around the island in decades. According to reports, China has sent about 90 warships to military exercises around Taiwan.
South Korea's political instability remains in the spotlight, with President Yun Seok-Yeol facing criminal charges for failing to impose martial law last week.
dollar companies wait for CPI data
Beyond geopolitics, risk appetite was also weighed down by expectations for Wednesday's key US indicators, which are likely to be factored into the Federal Reserve's interest rate plans.
Although gold prices were firm before the CPI release, this did little to hinder gold's rally as the market remained hopeful that the Fed would make a policy decision next week.
Other precious metals were mixed in. It rose 0.3% to $950.80 an ounce, while it fell 0.2% to $32.678 an ounce.
Copper is bright with China's cheers. CEWC is paying attention
The benchmark price on the London Metal Exchange rose 0.4% to $9,277.50 a tonne, while February rose 0.6% to $4.2978 a tonne.
The red metal soared this week after China, the world's biggest importer, vowed to ease monetary policy and take targeted fiscal measures to boost economic growth.
The focus now is on China's Central Economic Work Conference, which begins on Wednesday and is likely to decide on Beijing's economic agenda for 2025, including its economic stimulus package.
Data showing a sharp increase in China's copper imports through November also supported sentiment.
