Gold Prices Steady at 10-Day High
Gold prices steadied at a 10-day high in Asian trading on Thursday after increasing bets on Federal Reserve rate cuts pushed the dollar and Treasury yields lower. However, gold’s advance stalled due to hawkish signals from the minutes of the Federal Reserve’s June meeting, while anticipation of key non-farm payroll data kept traders cautious.
The yellow metal posted strong gains on Wednesday, tracking a sharp decline in the dollar as traders increased their bets on a rate cut in September. This trend followed weaker-than-expected employment data and a weak reading of non-manufacturing activity.
Lower interest rates bode well for non-yielding assets like gold, as they reduce the appeal of Treasuries and the dollar. However, optimism about rate cuts remains constrained by the hawkish signals in the minutes from the Federal Reserve’s June meeting, which showed that policymakers were still unsure about lowering borrowing costs. Caution ahead of the release of non-farm payroll data, which has consistently exceeded expectations in recent months, also kept sentiment neutral.
The performance of other precious metals was mixed. Platinum futures rose 0.7%, while silver futures fell 0.5%. However, silver has significantly outperformed gold over the past twelve months. Among industrial metals, copper prices steadied after making some gains thanks to a weaker dollar. But copper’s gains were limited by signs of slowing U.S. economic activity, while weak signals from China also weighed on copper this week.
London Metal Exchange copper futures fell 0.2% to $9,849.0 per ton. Copper futures suffered sharp losses in June as sentiment towards China, the largest copper importer, deteriorated.
