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Gold prices saw a slight decline on Friday, trimming some of the week’s gains, as Federal Reserve officials provided a more cautious outlook on potential interest rate cuts.
Gold Retreats Amid Fed Caution
Gold had surged close to $2,400 an ounce earlier in the week following softer U.S. economic data. However, the metal pulled back on Thursday and Friday as Fed officials cautioned against premature expectations of rate cuts.
- Spot gold steadied at $2,377.40 an ounce.
- Gold futures for June delivery slipped to $2,381.10 an ounce by 00:19 ET (04:19 GMT).
Several Fed policymakers indicated that more substantial evidence of declining inflation was needed before considering rate reductions. This led traders to reassess the likelihood of a rate cut in September, resulting in a rebound of the dollar and U.S. Treasury yields.
Despite the pullback, softer-than-expected consumer price index readings helped gold achieve a 0.7% gain for the week. While the yellow metal approached its record high of above $2,430 an ounce, it is unlikely to reach this level in the near term.
Other Precious Metals
Other precious metals also saw declines on Friday but remained set for strong weekly gains:
- Platinum futures fell 0.2% but were up 6.2% for the week.
- Silver futures dropped 0.4% but gained 4.5% over the week.
Copper Prices Mixed Amid Mixed Economic Signals from China
Copper prices exhibited mixed performance as markets responded to varied economic data from China, the world’s largest copper importer.
One-Month vs. Three-Month Futures
One-month copper futures fell from recent two-year highs, while three-month futures climbed, driven by expectations of tighter supplies and a potential demand recovery.
- Three-month copper futures on the London Metal Exchange rose 0.6% to $10,445.0 a ton.
- One-month copper futures increased by 0.3% to $4.8935 a pound.
China’s Economic Data
Data released on Friday showed a mixed economic outlook for China:
- Industrial production exceeded expectations.
- Retail sales growth slowed significantly.
- House prices continued to decline at a faster pace.
- Fixed asset investment growth also decelerated.
These mixed signals have created uncertainty about China’s economic recovery, even as the government implements stimulus measures to bolster growth. Nonetheless, three-month copper futures benefitted from optimism about future demand recovery, rising nearly 4% for the week and reaching two-year highs.
Gold prices eased slightly amid cautious comments from Federal Reserve officials, but maintained weekly gains driven by softer U.S. inflation data. Meanwhile, copper prices showed mixed results, reflecting uncertainties in China’s economic recovery. The precious metals market continues to be influenced by global economic indicators and central bank policies, requiring investors to stay vigilant in monitoring these developments.
