Gold prices hit record high as dollar recovers amid inflation warning By Investing.com

Investing.com – Gold prices fell slightly in Asian trading on Wednesday as the dollar recovered from a 13-month low. Focus remains on upcoming key inflation data, which will provide further clues on interest rates.

But the yellow metal remained within sight of its highs this month as geopolitical unrest fueled safe-haven demand and the prospect of lower U.S. interest rates also kept gold in strong demand.

fell 0.5% to $2,512.88 an ounce, while December expiring grades fell 0.2% to $2,547.60 an ounce by 00:37 ET (04:37 GMT). Spot prices hit a record high of $2,532.05 an ounce last week.

Gold price stagnates as dollar recovers; PCE data on the way

The yellow metal was pulled down from its record highs as it recovered from its 13-month low earlier this week.

However, the price of gold was able to defend most of its gains, while the dollar’s recovery remained limited due to continued speculation that the US Federal Reserve would begin cutting interest rates in September.

This assumption was reinforced by dovish comments from Fed officials in recent meetings, with traders divided on whether rates should be cut by 25 or 50 basis points.

The new data – the Fed’s preferred inflation indicator – is expected this Friday and should provide further clues on the direction of interest rates.

Lower interest rates bode well for gold as they lower the opportunity cost of investing in non-yielding assets. This perception also encouraged inflows into other precious metals, although they lagged far behind gold’s rally last month.

fell 0.8% to $959.40 an ounce, while it fell 0.5% to $30,280 an ounce.

Copper price falls, recovery stagnates, concerns about China increase

Among industrial metals, copper prices fell on Wednesday as the red metal’s recovery cooled and fresh concerns about top importer China further undermined prices.

The benchmark on the London Metal Exchange fell 0.6% to $9,370.50 a tonne, while the one-month price fell 0.7% to $4.2715 a pound.

Copper prices rose sharply last month as they recovered from multi-month lows hit in July amid ongoing concerns about slowing demand.

Those concerns came to the fore again this week after Canada imposed high trade tariffs on China’s electric vehicle industry, drawing the ire of Beijing.

Traders feared a renewed trade war between China and the West, which could further slow China’s slowing economic recovery and reduce demand for copper.

The electric vehicle sector is also an important source of copper demand.