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Investing.com– Gold prices moved in a flat-to-low range on Wednesday, extending their recent run of muted performance as anxiety over higher-for-longer U.S. interest rates persisted ahead of key economic readings.
The yellow metal remained squarely within a $2,000 to $2,050 trading range established over the past month, as any upside in gold was largely limited by a string of Federal Reserve warnings that the bank was in no hurry to begin trimming rates early in 2024. Strength in the , which remained near three-month highs, also pressured gold prices.
Still, gold prices also remained firm above the key $2,000 an ounce support level, indicating that fears of a global economic slowdown and geopolitical tensions in Russia and the Middle East were feeding some safe haven demand for the yellow metal.
steadied at $2,030.69 an ounce, while expiring in April fell 0.2% to $2,039.45 an ounce by 00:20 ET (05:20 GMT).
PCE inflation, GDP data awaited for more cues
Markets were now awaiting key inflation and economic growth readings for more trading cues.
data- the Fed’s preferred inflation gauge- is due on Thursday, and is expected to show inflation remained sticky in January. Such a scenario gives the Fed more impetus to keep interest rates higher for longer.
Several Fed officials also warned this week that sticky inflation will keep the Fed from lowering interest rates early in 2024.
Before the inflation data, a second reading on fourth-quarter is due later on Wednesday, and is expected to show some cooling in economic growth.
But the U.S. economy is still expected to remain well ahead of its developed world peers, giving the Fed enough headroom to keep rates higher for longer.
Higher rates herald more pressure on gold, given that they increase the opportunity cost of buying bullion. Other precious metals also retreated on this notion, with falling 0.5% to $892.05 an ounce, while fell 0.7% to $22.602 an ounce on Wednesday.
Copper prices dip, China PMIs awaited
Among industrial metals, expiring in March fell 0.4% to $3.8390 a pound.
The red metal saw a strong run-up in recent weeks on optimism over more stimulus measures in top importer China.
But this rally will be tested on Friday with the release of closely-watched data from the country, which is expected to provide more cues on the state of business activity through February.
Readings for January showed little improvement in the economy.
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