Investing.com — Gold prices fell slightly in Asian trading on Monday as traders waited for more signals on U.S. interest rates from testimony from Fed Chairman Jerome Powell and key inflation data due during the week.
But bullion prices were near one-month highs, and were also on the verge of getting back above $2,400 an ounce, amid growing belief that the Fed will start cutting rates in September . Broader metals prices also benefited from a decline in the dollar, which hit a near one-month low.
fell 0.3% to $2,384.47 per ounce, while the maturity expiring in August fell 0.2% to $2,392.55 per ounce at 00:33 ET (04:33 GMT).
Gold continues to rise slightly as interest rate cuts increase
Gold rose sharply last week, breaking out of the low $2,300s as a slew of weak labor market data fueled more optimism about rate cuts. Soft data on Friday was a key driver of gold’s rise.
The yellow metal will benefit from lower interest rates, which are expected to free up more liquidity and also reduce the appeal of the dollar and government bonds.
The traders shown estimate a more than 72% chance that the Fed will cut rates by 25 basis points in September, down from 59% last week.
The focus this week is on more signals about the US economy and monetary policy. will conduct two days of testimony before the Senate and House of Representatives, which could shed more light on the Fed’s interest rate plans.
Inflation figures are also available this week and are likely to play a role in the central bank’s interest rate outlook.
Other precious metals also fell on Monday, but posted strong gains from last week. fell 0.6% to $1,039.25 per ounce, while the price fell 1% to $31,370 per ounce.
Copper got involved amid China fears
Among industrial metals, copper prices were mixed on Monday as concerns about top importer China continued.
The benchmark on the London Metal Exchange rose 1% to $9,983.0 per tonne, while the index fell 0.9% in one month to $4.6235 per pound.
Concerns about China have negatively impacted copper prices in recent weeks, as recent European import tariffs on Chinese electric vehicles increased concerns about a trade war with the West.
Mediocre economic data from China had also cast doubt on an economic recovery in the country.
Chinese and will be on tap later this week.
