Gold Prices remain steady

25 Jun 2024 , 10:28 AM

Gold prices dipped on Tuesday as investors awaited crucial U.S. inflation data later in the week, which could influence the Federal Reserve’s decision on interest rates.

Key points from the market:

• Spot Gold: It declined by 0.1% to $2,329.64 per ounce by 0114 GMT, while U.S. gold futures also slipped 0.1% to $2,342.00.
• Fed’s Stance: Mary Daly, President of the San Francisco Federal Reserve, emphasized the importance of inflation nearing the Fed’s target of 2% before considering rate cuts.
• Upcoming Data: Traders are focused on the U.S. core PCE price index report due on Friday, which serves as a pivotal gauge for inflation trends and potential Fed actions.
• Fed Officials’ Insights: Comments from Fed Governors Lisa Cook and Michelle Bowman later this week are anticipated for further market insights.
• Market Sentiment: The market currently reflects a 68% probability of a Fed rate cut in September, according to the CME FedWatch Tool.
• Impact of Lower Rates: Gold, a non-yielding asset, tends to become more attractive as interest rates decrease, reducing its opportunity cost.
• China’s Economic Challenges: Retailers in China are grappling with uncertainties following a disappointing mid-year online shopping event, affecting the outlook for economic recovery in the world’s second-largest economy.
• Other Precious Metals: Spot silver declined by 0.3% to $29.53 per ounce, platinum rose 0.7% to $1,001.25, and palladium gained nearly 1% to $987.91. Palladium notably surged to a one-month high and briefly surpassed $1,000 amid tight supply conditions and investor activity.