As the Copper Rally Ends, Gold Prices Consolidate

According to a Reuters report, while gold prices experienced a slight decline, there was consolidation in the gold markets as the copper rally came to an end. However, markets continued to hold onto recent record levels as investors sought new clues about the US interest rate policy.

The slight dip in gold prices is currently focused on the upcoming release of the producer price index and retail sales data in the US. These data are expected to provide significant insights into shaping the US Federal Reserve’s interest rate policy.

Meanwhile, despite a decline in copper prices during Asian hours, it is noted that they remained near 11-month highs due to reports of production cuts at copper smelters in China causing congestion in the markets.

Overall, metal markets are under pressure as the dollar shows resistance ahead of economic data releases.

Gold prices are trading below record levels as new signals about interest rates emerge. Spot gold fell by 0.2% to $2,171.06, while April gold futures dropped by 0.3% to $2,175.35.

Last week, bullion prices surged to around $2,200, reaching record levels. However, rapid consolidation occurred as higher-than-expected consumer price index data revived fears of high interest rates in the markets.

Strong CPI data has shifted attention to the upcoming release of the producer price index and retail sales data today. These data are expected to significantly impact the Federal Reserve’s outlook on interest rates.

Gold and other precious metals continue to consolidate ahead of the upcoming data. Platinum fell by 0.4% to $942.45, while silver remained steady at $25.170.

Copper prices retreated from their 11-month highs following the end of the China-led rally. The May copper contract in the US fell by 0.5% to $4,038.2, while three-month futures on the London Metal Exchange dropped by 0.5% to $8,884 from a nine-month peak.

Reports of joint production cuts at China’s largest copper smelters support the red metal. However, uncertainty about the scope of planned cuts raises doubts about the future of copper prices. Especially considering China’s status as the world’s largest copper importer, its economic outlook could be decisive for copper prices going forward.

source: prepared by Melisa Beğiç

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