Q3 Earnings Alert! Plan early for this week’s stock reports with all key data in 1 placeSee list

Gold prices steady above $2,500 amid rate cut cheer

Published 26/08/2024, 06:34
© Reuters.
XAU/USD
-
GC
-
HG
-
SI
-
PL
-

Investing.com-- Gold prices fell slightly in Asian trade on Monday, but remained in sight of record highs last week as the prospect of lower U.S. interest rates battered the dollar and presented a brighter outlook for metal markets. 

The yellow metal had surged to record highs last week, headlining gains across metal markets as traders welcomed dovish comments from the Federal Reserve. Some safe haven demand also buoyed gold as ceasefire talks between Israel and Hamas yielded few results, while hostilities in the Middle East persisted. 

Spot gold fell 0.1% to $2,509.88 an ounce, while gold futures expiring in December fell 0.1% to $2,545.10 an ounce by 00:57 ET (04:57 GMT). Spot prices hit a record high of $2,532.05 an ounce last week. 

Gold cheered by rate cut hopes, weak dollar 

Gains in the yellow metal came as the dollar sank to a 13-month low, amid growing conviction that the Fed will begin trimming rates in September.

This notion was furthered by comments from Fed Chair Jerome Powell on Friday, who said that rate cuts were imminent and that further cooling in the labor market was unwelcome.

The prospect of lower rates bodes well for gold and other precious metals, given that it reduces the opportunity cost of investing in non-yielding assets. 

Other precious metals clocked some gains last week, but retreated on Monday. Platinum futures fell 0.6% to $965.45 an ounce while silver futures fell 0.4% to $30.145 an ounce.

Some safe haven demand was also in play, as hostilities between Israel and Hezbollah increased over the weekend, while fighting between Russia and Ukraine also continued. 

Copper rebound cools, but China caution persists 

Among industrial metals, copper prices fell slightly on Monday as a rebound from recent lows cooled, amid persistent concerns over slowing demand in top importer China. 

While the prospect of lower rates did inspire some flows into copper, the red metal was still nursing a tumble from record highs through July and August.

One-month Copper Futures fell 0.1% to $4.2557 a pound, having rebound sharply through the past week on hopes that lower interest rates will help spur increased global demand for copper.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.