Gold Prices Fall from Record Highs Amid Risk Aversion
Gold Prices Dip in Asian Trade
Gold prices fell from record highs in Asian trade on Wednesday, as traders awaited Federal Reserve Chair Jerome Powell’s testimony. Despite this, a surge in safe-haven demand was observed amidst a volatile market landscape.
Record Highs Reached on Tuesday
The yellow metal hit record highs on Tuesday, driven by safe-haven demand and expectations of future U.S. interest rate cuts. Spot gold fell 0.1% to $2,126.31 an ounce, while gold futures for April dropped 0.4% to $2,134.25 an ounce by 23:59 ET (04:59 GMT).
Analysts’ Insights
ANZ analysts noted that many investors who missed the recent upsurge in gold prices are now flocking to the precious metal amid concerns of a potential stock market correction. This shift has contributed to gold’s recent rally.
Powell’s Testimony Impact
Markets are eagerly anticipating Powell’s testimony, which could provide crucial insights into future U.S. interest rate decisions. The Fed’s cautious approach to rate cuts, especially in light of persistent inflation, remains a key factor influencing gold prices.
Impact on Precious Metals Market
While gold stole the spotlight, other precious metals exhibited mixed performance. Silver rose 0.5% to $89.60 an ounce, while platinum fell 0.5% to $23.858 an ounce. Traders are closely monitoring the Fed’s stance on rate cuts.
Focus on Economic Data and China’s Outlook
Aside from Powell’s testimony, attention is also drawn to economic data releases and China’s economic outlook. Copper prices remained stable around $3.8518 a pound, reflecting market uncertainty amidst China’s economic concerns.
