Gold Inches Higher in Asia as Dollar Strength Weighs on Metals Post-CPI
Gold prices saw a modest uptick during Asian trading on Wednesday, partially recovering from losses sustained overnight. The rebound came after stronger-than-expected U.S. inflation data lifted the dollar and dampened expectations for near-term interest rate cuts.
Other precious metals also posted slight gains following recent declines. Silver and platinum, which had surged to multi-year highs, saw some pullback this week as traders booked profits after strong rallies.
Despite the recovery, gold demand remained supported by ongoing geopolitical and economic uncertainties. Market participants continued to monitor the implications of President Donald Trump’s tariff policies, concerns over the Federal Reserve’s independence amid increasing political pressure on Chair Jerome Powell, and escalating tensions between Russia and Ukraine.
Spot gold rose 0.4% to $3,339.26 per ounce, while September gold futures were up 0.3% at $3,345.40 as of 01:32 ET (05:32 GMT).
Gold Stuck in Range, Lags Behind Other Precious Metals
Although prices gained slightly, gold remained confined within a $3,300 to $3,500 range—a pattern in place for the past three months. Analysts pointed to overbought conditions after record highs in April as a factor limiting further upside. In contrast, platinum and silver have outperformed gold, recently reaching their highest levels in over a decade.
Traders have turned to platinum and silver as more attractively priced alternatives to gold. Their gains have also been fueled by expectations of stronger demand and tightening supply.
However, both metals saw some cooling this week amid reduced bets on imminent rate cuts. Spot platinum held steady at $1,421.00 per ounce, while spot silver edged up to $37.8385.
Dollar Gains on Sticky Inflation, Adding Pressure on Metals
The broader metals market remained under pressure from a strengthening U.S. dollar, which climbed to a three-week high on Tuesday following a higher-than-expected CPI reading for June. Though the increase was slight, it suggested inflation may be becoming more persistent.
Industrial metals reflected this cautious sentiment: London copper futures were flat at $9,639.70 per ton, while U.S. copper futures slipped 0.4% to $5.4962 per pound.
The CPI data heightened concerns about the inflationary effects of Trump’s trade tariffs. The Federal Reserve has signaled that it intends to hold rates steady until it has greater clarity on the impact of these tariffs. Tuesday’s inflation figures likely reinforced that position.
Meanwhile, Trump and his allies have intensified their criticism of the Fed, pushing for Powell’s removal and renewed calls for rate cuts—further injecting uncertainty into the outlook for monetary policy.
