In the Asian trading session on Monday, gold prices edged higher, albeit staying notably below recent record peaks, as the prevailing strength of the dollar continued to exert pressure on metal markets.
Investors remained heavily inclined towards the dollar, anticipating further insights into U.S. inflation and interest rates. Despite some buying activity following steep losses on Friday, gold prices continued to hover below recent highs.
At 01:13 ET (05:13 GMT), spot gold saw a 0.2% increase to $2,169.77 per ounce, while gold futures expiring in April rose by 0.5% to $2,170.55 per ounce.
Gold Recovers Slightly from Record Highs, Dollar Maintains Strength
Bullion prices were notably below the record highs attained last week, which were buoyed by indications of potential interest rate cuts from the Federal Reserve, resulting in significant gains for the precious metal.
However, towards the end of the week, gold experienced a sharp decline from those record highs. This downturn was largely attributed to dovish signals from other central banks, prompting investors to predominantly shift towards the dollar, perceived as a high-yielding and low-risk currency.
On Monday, the dollar index surged by 0.4% to reach a one-month high. The dollar’s robust performance was further fueled by anticipation surrounding the forthcoming release of the PCE price index data, the Federal Reserve’s preferred inflation metric, scheduled for later in the week. Additionally, comments from various Fed officials throughout the week contributed to the dollar’s strength.
Mixed Performance in Other Precious Metals
In contrast, other precious metals displayed a mixed performance on Monday, following significant declines in the preceding session. Platinum futures recorded a 0.6% increase, reaching $913.40 per ounce, while silver futures witnessed a slight dip of 0.1%, settling at $24.812 per ounce.
Copper Prices Rebound, but Fail to Reach Recent Highs
Among industrial metals, copper prices staged a notable recovery on Monday after experiencing substantial losses in the previous session. However, despite this rebound, copper prices remained well below the 11-month highs achieved last week.
Three-month copper futures on the London Metal Exchange registered a 0.6% increase, reaching $8,911.0 per ton, while one-month U.S. copper futures saw an uptick of 0.8%, reaching $4.0315 per pound.
The decline in copper prices from their recent highs was attributed to data released on Friday, suggesting that global copper supplies might not be as constrained as initially anticipated. Notably, the recent rally in copper prices was primarily driven by expectations of tighter supplies following indications from major Chinese refiners about plans to curtail production.
However, Chinese data released on Friday revealed that copper inventories in the country surged to four-year highs in recent months, signaling that supplies in the world’s largest copper importer remained robust.