Investing.com– Gold prices fell in Asian trade on Tuesday, sticking to a tight trading range in the low $2,300s as recent strength in the dollar and anticipation of key inflation data kept traders averse to the yellow metal.
Metal markets took limited relief from an overnight drop in the dollar, as the greenback still remained in favor amid uncertainty over U.S. interest rates.
fell 0.4% to $2,325.56 an ounce, while fell 0.3% to $2,337.35 an ounce by 00:10 ET (04:10 GMT).
Gold stuck around $2,300 with inflation data on tap
The yellow metal fell into a trading range around the low $2,300 an ounce level over the past week, as traders grew uncertain over the prospect of U.S. interest rate cuts this year.
While inflation data for May was somewhat encouraging, it still showed price pressures remaining relatively heady. Unexpectedly strong purchasing managers index prints for June also sparked concerns that strength in the U.S. economy will keep rates high for longer.
Focus this week is squarely on data, which is the Federal Reserve’s preferred inflation gauge. The reading is due on Friday and is widely expected to show inflation cooling slightly but remaining well above the central bank’s 2% annual target.
High rates bode poorly for metal markets, given that they increase the opportunity cost of investing in non-yielding assets.
Other precious metals were mixed on Tuesday, but were also within recently established trading ranges. rose 0.4% to $1,016.55 an ounce, while fell 0.1% to $29.817 an ounce.
Copper prices rise, but China jitters keep sentiment fragile
Among industrial metals, copper prices advanced on Tuesday, recovering marginally from recent losses.
But sentiment towards the red metal was stymied by concerns over its top importer, China. Beijing was seen raising the prospect of a trade war with the European Union and the U.S., in the face of steep import duties on Chinese electric vehicles.
Benchmark on the London Metal Exchange rose 0.4% to $9,703.50 a tonne, while one-month rose 0.5% to $4.4413 a pound.
Both contracts were nursing steep declines in recent weeks, as sentiment towards China soured and as doubts emerged over the prospect of a global economic recovery this year.
