Investing.com-- Gold prices steadied in Asian trade after rebounding back above a key support level on Thursday, although momentum in the yellow metal was stalled by persistent expectations of higher-for-longer U.S. interest rates.
The yellow metal rebounded in overnight trade after the Federal Reserve quashed expectations for any further interest rate hikes- which pulled down the dollar and offered some relief to commodity prices.
But the Fed still signaled it was in no hurry to begin cutting interest rates- a trend that is expected to limit any major upside in gold.
Spot gold steadied at $2,319.98 an ounce after sinking below $2,300 earlier this week, while gold futures expiring in June hovered around $2,329.0 an ounce by 00:36 ET (04:36 GMT).
Fed offers mixed signals, nonfarm payrolls awaited
The Fed kept interest rates steady on Wednesday, as widely expected.
But Chair Jerome Powell, in his post-meeting address, offered somewhat mixed signals on the path of rates.
While Powell said that stalling disinflation- particularly in inflation moving towards the Fed’s 2% target- gave the bank little confidence to begin cutting interest rates early. But Powell also said that the bank did not plan to hike rates further.
The latter comment spurred some weakness in the dollar, pulling it off near six-month highs. This move offered some relief to metal prices, which were nursing steep losses in the lead-up to the Fed meeting.
Still, the prospect of U.S. rates remaining high for longer dents the outlook for gold prices, especially given that safe haven for the yellow metal was also seen declining in recent sessions.
Other precious metals rose on Thursday after bruising losses earlier this week. Platinum futures rose 0.6% to $968.30 an ounce, while silver futures rose 0.3% to $26.825 an ounce.
Copper prices steady below 2-year highs
Among industrial metals, copper prices steadied near two-year highs as uncertainty over U.S. interest rates stalled a recent rally in the red metal.
Three-month copper futures on the London Metal Exchange rose 0.5% to $9,950.0 a ton, while one-month copper futures fell 0.1% to $4.5648 a pound.
Both contracts remained well below two-year highs hit in April, as markets awaited more cues on economic growth and demand.