Gold futures declined for a third day on Wednesday to end at the lowest level in nearly two weeks as investors awaited the release of the July U.S. consumer-price inflation report following data from China showing deflation has reemerged in the world’s second-largest economy.
Price action
-
Gold futures for December delivery
GC00,
-0.30% GCZ23,
-0.30%
were off by $9.30, or 0.5%, to settle at $1,950.60 per ounce. That was the lowest settlement for the most-active gold since July 27 when it ended at 1945.70, according to Dow Jones Market Data. -
Silver futures for September delivery
SI00,
+0.11% SIU23,
+0.11%
fell by 8 cents, or 0.3%, to end at $22.73 per ounce. -
Palladium futures for September
PA00,
+4.59% PAU23,
+4.59%
rose by $13.40, or 1.1%, to finish at $1,231.50 per ounce, while platinum futures for October delivery
PL00,
+2.11% PLV23,
+2.11%
fell by $11.50, or 1.3%, to settle at $892.70 per ounce. -
Copper futures for September delivery
HG00,
-0.73% HGU23,
-0.73%
rose by 2 cents, or 0.5%, ending at $3.78 per pound.
Market drivers
Investors were waiting for the next batch of U.S. inflation data due Thursday which could provide some insight into whether the Federal Reserve will raise interest rates again in September.
Economists polled by the Wall Street Journal expect consumer prices rose by 0.2% in July, on par with the 0.2% gain in June. The June data came in softer than economists had expected, spurring hopes that the Fed could end its campaign of interest rate hikes more quickly.
“Tomorrow brings the latest U.S. inflation data, which will be an important reference point for the Federal Reserve when the committee meets next month to decide whether to keep raising interest rates or if inflation is now sufficiently on the downward trajectory for the US central bank to be able to leave rates unchanged,” said Rupert Rowling, market analyst at Kinesis money, in emailed commentary.
See: July CPI to come in close to expectations as U.S. settles into final mile along the road to lower inflation, traders say
The latest batch of economic data out of China, released Wednesday, showed consumer prices fell in July, the first such decline in two years, raising the specter of deflation and further complicating China’s post-COVID-19 reopening recovery.
Gold prices have been falling over the past week as the U.S. dollar and global bond yields, particularly Treasury yields, have risen. The ICE U.S. Dollar Index
DXY,
was off by less than 0.1% at 102.47, but remained up 0.4% so far this week.
The yield on the 10-year Treasury note
BX:TMUBMUSD10Y
was down modestly by 1 basis point to 4.01%, while the yield on the 2-year Treasury
BX:TMUBMUSD02Y
advanced 6 basis points to 4.80%.
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