HG MARKETS:

Gold prices saw a modest decline in Asian trading on Wednesday, extending losses from the previous session as traders favored the dollar ahead of crucial U.S. inflation data. The precious metal remained within a trading range around the low $2,300 per ounce level that had been established throughout most of June, as the prospect of elevated U.S. interest rates continued to weigh on its price outlook. Spot gold decreased by 0.1% an ounce, while gold futures for August fell 0.1% to $2,328.40 an ounce.

Gold prices have remained range bound with PCE inflation data on the horizon. The yellow metal trended lower this week, with trading volumes subdued as markets awaited the release of the Personal Consumption Expenditures (PCE) price index data scheduled for this week on Friday at 1730 HRS PKT. This reading, due on Friday, is the Federal Reserve’s preferred measure of inflation and is expected to influence the central bank’s outlook on interest rates. Recent indicators of resilience in the U.S. economy such as robust purchasing manager’s index data and consumer confidence readings have heightened concerns that the Fed may have sufficient justification to maintain higher interest rates for an extended period. Several Fed officials have reiterated this sentiment in recent days. Additionally, a revised reading of first-quarter gross domestic product is anticipated to provide further insights into the U.S. economy this week.

Other precious metals experienced gains on Wednesday, although these were tempered by worries that prolonged high interest rates would negatively impact their prices in the coming months. The strength of the dollar, which hovered near two-month highs, also pressured metal prices. Platinum futures increased by 0.6% to $1,005.30 an ounce, while silver futures rose 0.2% to $29.25 an ounce.

Copper prices remained steady amid concerns regarding China. Among industrial metals, copper prices traded sideways on Wednesday, nursing significant losses sustained throughout June amid growing caution over the economic outlook of top importer China. Benchmark copper futures on the London Metal Exchange fell by 0.1% to $9,561.50 a ton, while one-month copper futures held steady at $4.3695 a pound. Sentiment towards copper was dampened by the prospect of a trade war between China and the West, particularly following the imposition of steep import tariffs on Chinese electric vehicles by the European Union and the United States. These tariffs are expected to pose additional challenges for the electric vehicle industry, which is anticipated to be a major driver of copper demand in the coming years.