Gold prices rise but still pinned below $4,900/oz amid inflation, Iran uncertainty
Investing.com-- Gold prices rose in Asian trade on Thursday, recovering a measure of recent losses but remaining well below key levels amid uncertainty over interest rates and the inflationary effects of the U.S.-Israel war on Iran.
Strong U.S. producer inflation data, coupled with an outlook of higher U.S. inflation from the Federal Reserve, pressured gold on Wednesday, dragging prices well below the coveted $5,000 an ounce level and to a more-than one-month low.
Spot gold rose 0.6% to $4,847.85/oz by 22:13 ET (02:13 GMT), while gold futures slid nearly 1% to $4,849.50/oz.
Weakness in gold came after the Federal Reserve left interest rates unchanged on Wednesday, and signaled uncertainty over the inflationary impact of the Iran war.
The Fed decision was preceded by stronger-than-expected producer price index inflation data for February.
The PPI print and the Fed’s comments ramped up uncertainty over the path of U.S. interest rates, with markets betting that the central bank will not cut rates any time soon. CME Fedwatch showed markets pricing in no rate cuts until at least September.
This notion weighed on gold, largely offsetting safe haven demand stemming from the Iran conflict. The yellow metal has struggled to make headway since the onset of the Iran war, and on Wednesday broke below a $5,000-$5,200/oz trading range seen for nearly a month.
Other precious metals rose slightly on Thursday, but were also nursing losses in recent sessions. Spot platinum rose 0.2% to $2,029.96/oz, while spot silver rose 0.9% to $76.0155/oz.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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