Gold Prices and Copper Prices Update
Gold Prices Drift Lower Amid Uncertainty Over Interest Rates
Gold prices saw a slight decline on Thursday, with little support from the weakening dollar and yields. The market remains uncertain about the possibility of higher U.S. interest rates. The yellow metal has been trading within the range of $2,000 and $2,050 over the past week as traders await further cues on the future of interest rates.
After robust U.S. economic data and hawkish comments from the Federal Reserve, gold prices are currently in a holding pattern. With expectations for early interest rate cuts this year largely priced out, the near-term outlook for gold remains uncertain. The prospect of the central bank delaying rate cuts until June 2024 has added to the cloudiness surrounding gold prices. Additionally, a spike in the dollar to three-month highs has further pressured bullion prices.
Currently, gold fell 0.1% to $2,032.61 an ounce, while the contract expiring in April fell 0.2% to $2,047.55 an ounce by 00:13 ET (05:13 GMT). The higher interest rates diminish the appeal of gold by increasing the opportunity cost of investing in the yellow metal.
Goldman Sachs Predicts Rangebound Gold Prices with Limited Downside
Goldman Sachs analysts have noted that the prospect of later U.S. rate cuts may present headwinds to bullion prices. However, they believe that any major losses in gold would be limited by several factors. Analysts anticipate that physical demand for gold will remain high due to consistent buying by central banks and steady demand in emerging markets. They have maintained their 12-month target price for spot gold at $2,175 an ounce.
Moreover, increased geopolitical uncertainty, especially after the rejection of an Israel-Hamas ceasefire this week, indicates higher safe-haven demand for gold in the near-term.
Copper Prices Near Three-Week Low on Negative China Cues
Copper prices, on the other hand, rose slightly on Thursday but are pinned near three-week lows following more weak economic cues from top importer China. The contract expiring in March rose 0.4% to $3.7523 a pound but remains just above their lowest levels since mid-January.
The economic data from China indicates that the country’s economy is still struggling with deflation amid slowing growth, which in turn factored into concerns over a slowdown in Chinese copper demand.
Investing.com– Gold prices drifted slightly lower on Thursday, taking little support from a decline in the dollar and yields as markets remained on edge over the prospect of higher-for-longer U.S. interest rates.
But the yellow metal stuck largely within a trading range of $2,000 and $2,050 established over the past week, with traders now awaiting more cues on the path of interest rates.
Gold prices fell within a holding pattern after robust U.S. economic data and a chorus of hawkish Federal Reserve comments saw markets largely price out expectations for early interest rate cuts this year.
With the central bank now expected to begin trimming rates only from June 2024, the near-term outlook for gold remained cloudy. A spike in the – to three-month highs- also pressured bullion prices, although the greenback saw a heavy dose of consolidation this week.
fell 0.1% to $2,032.61 an ounce, while expiring in April fell 0.2% to $2,047.55 an ounce by 00:13 ET (05:13 GMT).
Higher interest rates diminish gold’s appeal by increasing the opportunity cost of investing in the yellow metal.
Gold to remain rangebound, but downside limited by other factors- Goldman Sachs
Goldman Sachs analysts wrote in a recent note that while the prospect of later U.S. rate cuts presented some headwinds to bullion prices, any major losses in gold would be limited by a slew of factors.
Analysts expect physical demand for gold to remain high on consistent buying by central banks and steady demand in emerging markets.
Goldman Sachs analysts maintained their 12-month target price for spot gold at $2,175 an ounce.
Increased geopolitical uncertainty, especially after the rejection of a Israel-Hamas ceasefire this week, also pointed to higher safe-haven demand for gold in the near-term.
Copper prices near three-week low on negative China cues
Among industrial metals, copper prices rose slightly on Thursday but were pinned near three-week lows following more weak economic cues from top importer China.
expiring in March rose 0.4% to $3.7523 a pound, but were just above their lowest levels since mid-January.
data from China read weaker than expected for January, while shrank for a sixteenth consecutive month. The also fell at its worst pace since late-2009.
The data indicated that China’s economy was still struggling with deflation amid slowing growth, which in turn factored into concerns over a slowdown in Chinese copper demand.
