2023-06-29 09:35:00
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Investing.com – Gold prices fell to a three-month low on Thursday, pressured by a rise in yields and the Treasury following Federal Reserve Chairman Jerome said an interest rate hike was likely.
Concerns regarding rising interest rates also dragged down copper prices, with traders selling the red metal heavily amid fears of slowing global economic growth.
Speaking at , Powell said that although the central bank has “come a long way,” there is still the possibility that interest rates will rise further.
His comments sent up and , while affecting the outlook for non-yielding assets such as gold and other metals. Markets are also beginning to price in a greater possibility of a rate hike at the upcoming Federal Reserve meeting in late July.
It settled at $1,905.85 an ounce, while it decreased by 0.3% to $1,913.75 an ounce.
Today, gold awaits important data from the United States, with the release of data at 12:30 GMT (15:30 GMT).
Gold is under pressure as markets look at a 25 basis point rally in July
Powell’s comments, which also came following somewhat hawkish testimony before Congress last week, sent the markets running.
While the Fed kept interest rates steady during its June meeting, it emphasized a more data-driven approach to future interest rate decisions. With US inflation still well above the central bank’s target range, markets are poised for further rally.
Rising US interest rates bode badly for gold and other metals, given that they raise the opportunity cost of holding non-yielding assets. This notion had hammered gold into 2022, and has kept the yellow metal trading negative so far this year.
The focus this week is also on the — the Fed’s preferred inflation measure, which is due for release on Friday. The reading is expected to show that inflation held steady in May.
Other precious metals weakened on Thursday. It fell 0.1% to a four-month low, while it fell 0.6% and hovered near a one-month low.
Copper was affected by the weak economic outlook and uncertainty in China
Copper prices held near a one-month low on Thursday, following falling for the past five sessions. at $3.7292 a pound, following falling nearly 5% over the past week.
Concerns regarding slowing industrial activity around the world diminished copper’s appeal, with traders fearing a similar slowdown in demand for the red metal.
Uncertainty regarding China, the world’s largest copper importer, also grew ahead of key data due on Friday, which is set to provide more signals regarding a slowing economic recovery in the country.
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