Gold prices experienced a slight decline in Asian trade on Thursday, remaining near recent record highs as investors awaited further signals on U.S. interest rates from upcoming economic data releases. At the same time, copper prices retreated from recent peaks but continued to hover near 11-month highs following reports of production cuts by Chinese smelters, suggesting tighter market conditions for the industrial metal.
In Asian trade, spot gold fell by 0.2% to $2,171.06 per ounce, while gold futures expiring in April declined by 0.3% to $2,175.35 per ounce. Despite this slight pullback, gold remained close to record highs achieved earlier in the week, around $2,200 per ounce, as investors assessed the implications of hotter-than-expected consumer price index (CPI) data on U.S. interest rate expectations.
Investors are closely monitoring upcoming readings on producer price index (PPI) inflation and retail sales, expected later in the day, to gain insights into the Federal Reserve’s stance on monetary policy. The Federal Reserve is widely anticipated to keep interest rates steady during its upcoming meeting next week, with any potential changes likely to be guided by the path of inflation in the coming months.
Meanwhile, copper prices softened after reaching 11-month highs, with U.S. copper futures expiring in May slipping by 0.5% to $4.0382 a pound. Three-month LME copper futures also fell by 0.5% to $8,884 a metric ton from a nine-month peak. The red metal had received a boost from reports indicating that China’s major copper smelters had agreed to reduce production, although uncertainties remained regarding the extent of the planned cuts.
Despite the recent rally in copper prices fueled by supply concerns, doubts persist about the sustainability of the upward trend, particularly amidst a challenging economic outlook for China, the world’s largest copper importer.